(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
| 38-3317208 | ||||||||||
(State or other jurisdiction of |
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| (I.R.S. Employer | ||||||||||
30142 S. Wixom Road, Wixom, Michigan | 48393 | ||||||||||
(Address of principal executive offices) | (Zip Code) | ||||||||||
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||||||||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | ||||||||
| Emerging growth company | ☐ | ||||||||||
Page September 30, December 31, 2017 2016 ASSETS Cash and Cash Equivalents $ 3,887,923 $ 17,180,594 Investments Available for Sale 35,028,841 40,759,703 Accounts Receivable, net of a reserve of $6,000 in 2017 and $5,000 in 2016 5,374,390 6,393,228 Inventory 14,864,642 12,141,072 Other Current Assets 2,032,095 2,034,598 Total Current Assets 61,187,891 78,509,195 Property and Equipment, net 1,708,817 1,391,575 Inventory, Non-Current 1,494,175 1,826,554 Intangible Assets 4,117 4,382 Goodwill 920,745 920,745 Other Non-current Assets 490,655 501,187 Total Assets $ 65,806,400 $ 83,153,638 LIABILITIES AND SHAREHOLDERS’ EQUITY Accounts Payable $ 4,188,677 $ 5,858,234 Accrued Liabilities 3,231,789 4,210,151 Customer Deposits 199,407 77,217 Total Current Liabilities 7,619,873 10,145,602 Deferred License Revenue 17,396,167 20,051,737 Shareholders’ Equity: Common Shares, no par value, 51,761,040 and 51,527,711 shares issued and outstanding 272,055,391 268,199,939 Accumulated Deficit (231,223,093) (214,341,092) Accumulated Other Comprehensive Income (41,938) (902,548) Total Shareholders’ Equity 40,790,360 52,956,299 Total Liabilities And Shareholders’ Equity $ 65,806,400 $ 83,153,638 Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Nine Months Ended September 30, 2017 Nine Months Ended September 30, 2016 Sales $ 14,626,904 $ 12,814,815 $ 42,462,265 $ 39,894,380 Cost of Sales 13,555,853 11,234,934 37,535,454 35,130,045 Gross Profit 1,071,051 1,579,881 4,926,811 4,764,335 Selling, General and Administrative 4,791,636 5,070,127 17,433,530 15,071,238 Research and Product Development 1,304,658 1,261,863 4,195,003 4,639,617 Operating Income (Loss) (5,025,243) (4,752,109) (16,701,722) (14,946,520) Interest and Investment Income (31,751) 188,847 (180,279) 602,429 Income (Loss) Before Income Taxes (5,056,994) (4,563,262) (16,882,001) (14,344,091) Income Tax Expense — — — (404,527) Net Income (Loss) $ (5,056,994) $ (4,563,262) $ (16,882,001) $ (14,748,618) Basic Earnings (Loss) per Share $ (0.10) $ (0.09) $ (0.33) $ (0.29) Diluted Earnings (Loss) per Share $ (0.10) $ (0.09) $ (0.33) $ (0.29) Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Nine Months Ended September 30, 2017 Nine Months Ended September 30, 2016 Net Income (Loss) $ (5,056,994) $ (4,563,262) $ (16,882,001) $ (14,748,618) Unrealized Gain on Available-for-Sale Investments 248,628 115,541 860,752 311,273 Foreign Currency Translation Adjustments 132 (18) (142) (18) Comprehensive Income (Loss) $ (4,808,234) $ (4,447,739) $ (16,021,391) $ (14,437,363) ACCUMULATED OTHER TOTAL COMMON SHARES ACCUMULATED COMPREHENSIVE SHAREHOLDER’S SHARES AMOUNT DEFICIT INCOME (LOSS) EQUITY Balance as of December 31, 2016 51,527,711 $ 268,199,939 $ (214,341,092) $ (902,548) $ 52,956,299 Net Loss — — (16,882,001) — (16,882,001) Unrealized Gain on Available-for-Sale Investments — — — 860,752 860,752 Foreign Currency Rate Changes — — — (142) (142) Issuance of Common Shares 21,000 116,105 — — 116,105 Shares Issued in Exchange for Services 50,000 158,667 158,667 Stock Option Based Expense — 3,275,339 — — 3,275,339 Stock Tendered in Satisfaction of Tax Liabilities (317,671) (2,287,231) — — (2,287,231) Restricted Stock Amortization 480,000 2,592,572 — — 2,592,572 Balance as of September 30, 2017 51,761,040 $ 272,055,391 $ (231,223,093) $ (41,938) $ 40,790,360 2017 2016 Cash Flows From Operating Activities: Net (Loss) $ (16,882,001) $ (14,748,618) Adjustments To Reconcile Net Loss To Net Cash Used In Operating Activities: Depreciation and Amortization 384,835 583,501 Share Based Compensation—Non-employee 158,667 — Share Based Compensation—Employees 5,874,769 7,794,690 Loss on Disposal of Assets 4,084 7,340 Loss on Sale of Investments Available for Sale 704,695 26,820 Changes in Assets and Liabilities: (Increase) in Accounts Receivable (149,429) (2,984,463) (Increase) in Inventory (2,391,191) (3,888,489) Decrease (Increase) in Other Assets 224,635 (1,376,042) (Decrease) in Accounts Payable (1,669,651) (598,427) (Decrease) in Other Liabilities (863,034) (179,856) (Decrease) in Deferred License Revenue (1,494,360) (1,445,058) (Decrease) Increase in Deferred Drug License Revenue (204,543) 3,818,184 Changes in Assets and Liabilities (6,547,573) (6,654,151) Cash (Used In) Operating Activities (16,302,524) (12,990,418) Cash Flows From Investing Activities: Purchase of Investments Available for Sale (34,235,347) (23,158,809) Sale of Investments Available for Sale 40,122,266 24,491,678 Purchase of Equipment (706,346) (328,322) Proceeds on Sale of Assets 450 1,000 Cash Provided by Investing Activities 5,181,023 1,005,547 Cash Flows From Financing Activities: Proceeds from Issuance of Common Shares 116,105 80,161 Restricted Stock Retained in Satisfaction of Tax Liabilities (2,287,231) — Cash (Used In) Provided By Financing Activities (2,171,126) 80,161 Effects of exchange rate changes (44) (18) (Decrease) In Cash (13,292,671) (11,904,728) Cash At Beginning Of Period 17,180,594 31,198,182 Cash At End Of Period $ 3,887,923 $ 19,293,454 2017 2016 Income Taxes Paid $ — $ 404,527 Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Nine Months Ended September 30, 2017 Nine Months Ended September 30, 2016 Basic Weighted Average Shares Outstanding 51,260,975 50,677,076 50,995,079 50,675,667 Effect of Dilutive Securities — — — — Diluted Weighted Average Shares Outstanding 51,260,975 50,677,076 50,995,079 50,675,667 Components of inventory, net of reserves, as of September 30, December 31, 2017 2016 Raw Materials $ 10,868,301 $ 10,903,084 Work in Process 231,381 86,452 Finished Goods 5,259,134 2,978,090 Total $ 16,358,816 $ 13,967,626 Triferic (dialysate) and Triferic AVNU in the United States. As of both March 31, 2023 and December 31, 2022, the total Triferic inventory net of reserve was $1.3 million. As of March 31, 2023 and December 31, 2022, Rockwell had total Concentrate inventory aggregating $5.6 million and $5.8 million, respectively, against which Rockwell had reserved $25,000 for both periods. Other factors not currently anticipated may also materially and adversely affect our results of operations, cash flow and financial position. There can be no assurance Results of Operations for the Three Months Ended March 31, 2023 and 2022 2023. condensed consolidated financial statements included elsewhere in this Form 10-Q for more information on our debt facility). Other expense for the three months ended March 31, 2022 was $0.5 million of interest expense related to our debt facility. March 31, 2023. We XBRL Instance Document XBRL Taxonomy Extension Schema XBRL Taxonomy Extension Calculation Linkbase XBRL Taxonomy Extension Definition Database XBRL Taxonomy Extension Label Linkbase XBRL Taxonomy Extension Presentation Linkbase ROCKWELL MEDICAL, INC. (Registrant) ◻☐APPLICABLE ONLY TO CORPORATE ISSUERS:IndicateTitle of each class: Trading Symbol Name of each exchange on which registered: Common Stock, par value $0.0001 RMTI Nasdaq Capital Market outstanding of each of the issuer’s classes of common stock outstanding as of the latest practicable date.May 12, 2023 was 13,743,673.ClassOutstanding as of October 31, 2017Common Stock, no par value51,761,040 shares34567812171717181920Triferic® is a registered trademark of Rockwell Medical, Inc.2As of September 30, 2017 and December 31, 2016(Unaudited)March 31,
2023December 31,
2022(Unaudited) ASSETS Cash and Cash Equivalents $ 10,894 $ 10,102 Investments Available-for-Sale 5,940 11,390 Accounts Receivable, net 6,021 6,259 Inventory 5,595 5,814 Prepaid and Other Current Assets 1,240 1,745 Total Current Assets 29,690 35,310 Property and Equipment, net 2,179 2,194 Inventory, Non-Current 1,276 1,276 Right of Use Assets-Operating, net 3,558 3,943 Right of Use Assets-Financing, net 2,326 2,468 Goodwill 921 921 Other Non-Current Assets 522 523 Total Assets $ 40,472 $ 46,635 LIABILITIES AND STOCKHOLDERS’ EQUITY Accounts Payable $ 5,202 $ 4,053 Accrued Liabilities 4,359 7,702 Lease Liability-Operating - Current 1,473 1,483 Lease Liability-Financing - Current 532 522 Deferred License Revenue - Current 259 1,731 Term Loan - Net of Issuance Costs 3,131 1,631 Insurance Financing Note Payable — 503 Customer Deposits 114 66 Total Current Liabilities 15,070 17,691 Lease Liability-Operating - Long-Term 2,214 2,581 Lease Liability-Financing - Long-Term 1,950 2,088 Term Loan, Net of Issuance Costs 6,147 7,555 Deferred License Revenue - Long-Term 2,535 2,600 Long Term Liability - Other 14 14 Total Liabilities 27,930 32,529 Stockholders’ Equity: Preferred Stock, $0.0001 par value, 2,000,000 shares authorized; 15,000 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively — — Common Stock, $0.0001 par value; 170,000,000 shares authorized; 12,552,673 and 12,163,673 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively 1 1 Additional Paid-in Capital 402,894 402,701 Accumulated Deficit (390,509) (388,759) Accumulated Other Comprehensive Income 156 163 Total Stockholders’ Equity 12,542 14,106 Total Liabilities and Stockholders’ Equity $ 40,472 $ 46,635 3INCOME STATEMENTSFor the three OF OPERATIONSnine months ended September 30, 2017 and September 30, 2016 (Unaudited)Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 Net Sales $ 19,668 $ 16,124 Cost of Sales 17,069 16,910 Gross Profit (Loss) 2,599 (786) Research and Product Development 278 1,567 Selling and Marketing 498 455 General and Administrative 3,250 3,818 Operating Loss (1,427) (6,626) Other (Expense) Income Realized Gain on Investments — 4 Interest Expense (387) (540) Interest Income 64 — Total Other Expense (323) (536) Net Loss $ (1,750) $ (7,162) Basic and Diluted Net Loss per Share $ (0.10) $ (0.84) Basic and Diluted Weighted Average Shares Outstanding 18,359,940 8,544,225 4INCOME (LOSS)For the three and nine months ended September 30, 2017 and September 30, 2016(Unaudited)Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 Net Loss $ (1,750) $ (7,162) Unrealized Loss on Available-for-Sale Debt Instrument Investments (3) — Foreign Currency Translation Adjustments (4) (1) Comprehensive Loss $ (1,757) $ (7,163) 5SHAREHOLDERS'STOCKHOLDERS' EQUITYFor the nine months ended September 30, 2017(Unaudited)PREFERRED STOCK COMMON STOCK ADDITIONAL PAID-IN CAPITAL ACCUMULATED
DEFICITACCUMULATED
OTHER
COMPREHENSIVE
INCOMETOTAL
STOCKHOLDERS'
EQUITYSHARES AMOUNT SHARES AMOUNT Balance as of January 1, 2023 15,000 $ — 12,163,673 $ 1 $ 402,701 $ (388,759) $ 163 $ 14,106 Net Loss — — — — — (1,750) — (1,750) Unrealized Loss on Available-for-Sale Investments — — — — — — (3) (3) Foreign Currency Translation Adjustments — — — — — — (4) (4) Issuance of Common Stock upon exercise of Pre-Funded Warrants — — 389,000 — — — — — Stock-based Compensation — — — — 193 — — 193 Balance as of March 31, 2023 15,000 $ — 12,552,673 $ 1 $ 402,894 $ (390,509) $ 156 $ 12,542 6CASH FLOWSFor the nine months ended September 30, 2017 and September 30, 2016(Unaudited)Supplemental Cash Flow disclosurePREFERRED STOCK COMMON STOCK ADDITIONAL PAID-IN CAPITAL ACCUMULATED
DEFICITACCUMULATED
OTHER
COMPREHENSIVE
INCOMETOTAL
STOCKHOLDERS'
EQUITY (DEFICIT)SHARES AMOUNT SHARES AMOUNT Balance as of January 1, 2022 — $ — 8,544,225 $ 1 $ 372,562 $ (370,080) $ 52 $ 2,535 Net Loss — — — — — (7,162) — (7,162) Foreign Currency Translation Adjustments — — — — — — (1) (1) Stock-based Compensation — — — — (179) — — (179) Balance as of March 31, 2022 — $ — 8,544,225 $ 1 $ 372,383 $ (377,242) $ 51 $ (4,807) Three Months Ended
March 31, 2023Three Months Ended
March 31, 2022Cash Flows From Operating Activities: Net Loss $ (1,750) $ (7,162) Adjustments To Reconcile Net Loss To Net Cash Used In Operating Activities: Depreciation and Amortization 160 138 Stock-based Compensation 193 (179) Non-cash lease expense from Right of Use Asset 485 520 Amortization of Debt Financing Costs and Accretion of Debt Discount 92 92 Loss on Disposal of Assets 1 — Realized Gain on Sale of Investments Available-for-Sale — (4) Changes in operating Assets and Liabilities: Accounts Receivable, net 238 (1,208) Inventory 219 (1,455) Prepaid and Other Assets 505 630 Accounts Payable 1,149 485 Lease Liability (336) (490) Other Liabilities (3,295) (640) Deferred License Revenue (1,537) (538) Changes in operating Assets and Liabilities (3,057) (3,216) Cash Used In Operating Activities (3,876) (9,811) Cash Flows From Investing Activities: Purchase of Investments Available-for-Sale (2,053) (2,810) Sale of Investments Available-for-Sale 7,500 11,972 Purchase of Equipment (145) (29) Cash Provided by Investing Activities 5,302 9,133 Cash Flows From Financing Activities: Payments on Debt — (2,250) Payments on Insurance Financing Note Payable (503) (437) Payment on Financing Lease Liabilities (128) — Cash Used In Financing Activities (631) (2,687) Effect of exchange rate changes on cash (3) (1) Increase (Decrease) in Cash and Cash Equivalents 792 (3,366) Cash and Cash Equivalents at Beginning of Period 10,102 13,280 Cash and Cash Equivalents at End of Period $ 10,894 $ 9,914 Supplemental Disclosure of Cash Flow Information: Cash Paid for Interest $ 295 $ 461 Supplemental Disclosure of Noncash Investing and Financing Activities: Change in Unrealized Loss on Marketable Securities Available-for-Sale $ (3) $ — and Subsidiaries (collectively, “we”(the "Company", “our”"Rockwell", “us”"we", or the “Company”"us") is a fully-integrated pharmaceuticalhealthcare company targetingthat develops, manufactures, commercializes, and distributes a portfolio of hemodialysis products for dialysis providers worldwide.renalkidney disease treatment and is usually performed at freestanding outpatient dialysis centers, at hospital-based outpatient centers, at skilled nursing facilities, or in a patient’s home.disease with innovative products for the treatmentdisease. While Rockwell has discontinued commercialization of iron deficiency, secondary hyperparathyroidism and hemodialysis. We are currently marketing and developing unique, proprietary renal drug therapies. These novel renal drug therapies support disease management initiatives to improve the quality of life and care of dialysis patients and are designed to deliver safe and effective therapy, while decreasing drug administration costs and improving patient convenience and outcome. We have also obtained licenses for certain dialysis related drugs which we are developing and planning to market globally. We are also an established manufacturer and leader in delivering high-quality hemodialysis concentrates/dialysates to dialysis providers and distributorsTriferic in the United States, the Company has established several international partnerships with companies seeking to develop and abroad. We manufacture, sellcommercialize Triferic outside the United States and distribute hemodialysis concentratesis working closely with these international partners to develop and other ancillary medical productscommercialize Triferic in their respective regions. Additionally, Rockwell continues to evaluate the viability of its FPC platform and suppliesFPC's potential to treat iron deficiency, iron deficiency anemia, and acute heart failure.treatmentthree months ended March 31, 2023 was approximately $3.9 million. Based on the currently available working capital, management believes the Company currently has sufficient funds to meet its operating requirements for at least the next twelve months from the date of patientsthe filing of this report.End Stage Renal Disease, or “ESRD”Innovatus. As of the date of this report, the Company is in compliance with all covenants (See Note 14 for further detail). We supply our products to dialysis providersdistributors who treat patientscould be negatively affected by, among other things, increased U.S. trade tariffs and trade disputes with kidney disease. Our concentrate products are used to remove waste and replace essential nutrientsother countries, instability in the blood of dialysis patients during their hemodialysis treatment. The majority of our sales occurglobal capital and credit markets, recent bank failures in the United States.We are regulated byStates, supply chain weaknesses, and instability in the Federal Foodgeopolitical environment, including as a result of the Russian invasion of Ukraine and Drug Administration (“FDA”) underother political tensions, and lingering effects of the Federal DrugCOVID-19 pandemic. Such challenges have caused, and Cosmetics Act, as well as by other federal, statemay continue to cause, recession fears, rising interest rates, foreign exchange volatility and local agencies. We hold several FDA product approvals including both drugsinflationary pressures. At this time, the Company is unable to quantify the potential effects of this economic instability on our future operations.medical devices. 2.credit markets may limit the availability of funding, refinancing or increase the cost of funding. Due to the rapidly evolving nature of the global situation, it is not possible to predict the extent to which these conditions could adversely affect the Company's liquidity and capital resources in the future.Basis of PresentationOur consolidated financial statements include our accounts and the accounts for our wholly owned subsidiaries, Rockwell Transportation, Inc. and Rockwell Medical India Private Limited. All intercompany balances and transactions have been eliminated in consolidation. Recent Accounting Pronouncementsusingin accordance with the accounting principles generally accepted in the United States of America or “GAAP,”(“U.S. GAAP”) for interim financial information and withpursuant to the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the U. S. Securities and Exchange Commission Regulation S-X(“SEC”) and on the same basis as they apply to interimthe Company prepares its annual audited consolidated financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.DecemberMarch 31, 2016 has been derived from2023, and the audited financialcondensed consolidated statements at that dateof operations, comprehensive loss, changes in stockholders' equity, and cash flows for the three months ended March 31, 2023 and 2022 are unaudited, but does not include all adjustments, consisting of normal recurring adjustments the Company considers necessary for a fair presentation of the informationfinancial position, operating results and footnotes required by GAAPcash flows for complete financial statements.In the opinion of our management, all adjustments have been included that are necessary to make the financial statements not misleading. All of these adjustments that are material are of a normal and recurring nature. Our operatingperiods presented. The results for the three and nine months ended September 30, 2017March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2017. You should read our unaudited2023 or for any future interim period. The condensed consolidated balance sheet at December 31, 2022 has been derived from audited financial statements, togetherhowever, it does not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying condensed consolidated financial statements should be read in conjunction with the audited financial statements and related footnotes for the year ended December 31, 20162022 and notes thereto included in ourthe Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. Our Annual Report2022 as filed with the SEC on Form 10-KMarch 30, 2023. The Company’s consolidated subsidiaries consist of its wholly-owned subsidiaries, Rockwell Transportation, Inc. and Rockwell Medical India Private Limited.fiscal yeareffect of the reverse stock split.DecemberMarch 31, 20162023 and 2022 was calculated as follows:As of March 31, (In Thousands, Except Shares and Per Share Amounts) 2023 2022 Numerator: Net loss $ (1,750) $ (7,162) Net loss attributable to common stockholders for basic and diluted loss per share $ (1,750) $ (7,162) Denominator: Weighted average number of shares of common stock outstanding - basic and diluted 18,359,940 8,544,225 Net loss per share attributable to common stockholders - basic and diluted $ (0.10) $ (0.84) As of March 31, 2023 2022 Options to purchase common stock 1,194,202 511,117 Unvested restricted stock awards 891 891 Unvested restricted stock units 125,000 28,066 Convertible Preferred Stock 1,363,636 — Warrants to purchase common stock 10,196,268 2,402,442 Total 12,879,997 2,942,516 descriptionnew accounting pronouncement affects the Company’s financial reporting, the Company undertakes a review to determine the consequences of our significant accounting policies.Revenue RecognitionOur policy isthe change to recognize revenue consistent with authoritative guidance for revenue recognition includingits consolidated financial statements and assures there are sufficient controls in place to ascertain the provisions ofCompany’s consolidated financial statements properly reflect the change.Accounting Standards Codification. We recognize revenue when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery (or passage of title) has occurred or services have been rendered, (iii) the seller's price to the buyer is fixed or determinable, and (iv) collectability is reasonably assured.8Consistent with these guidelines we recognize revenue at the time we transfer title to our products to our customers which generally occurs when our products are delivered to our customer’s location consistent with our terms of sale. We recognize revenue for international shipments when title has transferred consistent with standard terms of sale.We apply judgment as we analyze each element of our contractual agreements to determine appropriate revenue recognition. The terms of our contractual agreements may include milestone payments if specified research and development objectives are achieved, non-refundable licensing fees, milestone payments on sales or royalties from product sales.When entering into an arrangement, we first determine whether the arrangement includes multiple deliverables and is subject to the accounting guidance in ASC subtopic 605-25, Multiple-Element Arrangements. If we determine that an arrangement includes multiple elements, we determine whether the arrangement should be divided into separate units of accounting and how the arrangement consideration should be measured and allocated among the separate units of accounting. An element qualifies as a separate unit of accounting when the delivered element has standalone value to the customer. Our arrangements do not include a general right of return relative to delivered elements. Any delivered elements that do not qualify as separate units of accounting are combined with other undelivered elements within the arrangement as a single unit of accounting. If the arrangement constitutes a single combined unit of accounting, we determine the revenue recognition method for the combined unit of accounting and recognize the revenue either on a straight-line basis or on a modified proportional performance method over the period from inception through the date the last deliverable within the single unit of accounting is delivered.Non-refundable upfront license fees are recorded as deferred revenue and recognized into revenue over the estimated period of our substantive performance obligations. If we do not have substantive performance obligations, we recognize non-refundable upfront fees into revenue through the date the deliverable is satisfied. Analyzing the arrangement to identify deliverables requires the use of judgment and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation. In arrangements that include license rights and other non-contingent deliverables, such as participation in a steering committee, these deliverables do not have standalone value because the non-contingent deliverables are dependent on the license rights. That is, the non-contingent deliverables would not have value without the license rights, and only we can perform the related services. Upfront license rights and non-contingent deliverables, such as participation in a steering committee, do not have standalone value as they are not sold separately and they cannot be resold. In addition, when non-contingent deliverables are sold with upfront license rights, the license rights do not represent the culmination of a separate earnings process. As such, we account for the license and the non-contingent deliverables as a single combined unit of accounting. In such instances, the license revenue in the form of non-refundable upfront payments is deferred and recognized over the applicable relationship period.For milestone payments based on sales and for royalties based on sales, we recognize revenue in the quarter that the information related to the sales becomes available and collectability is reasonably assured.For international license agreements that we have entered into, deferred license revenue is being recognized over the term of the license agreement.The initial payment of $20 million received pursuant to our long-term Exclusive Distribution Agreement (the “Distribution Agreement”("FASB") with Baxter Healthcare Corporation (“Baxter”) in October 2014 has been accounted for as deferred license revenue. Deferred license revenue is being recognized based on the proportion of product shipments to Baxter in each period to total expected sales volume for the term of the agreement. See Note 4 to condensed consolidated financial statements for information related to the settlement of arbitration proceedings with Baxter. We recognize other revenues at the time the related fees and or payments are earned.We require certain customers, mostly international customers, to pay for product prior to the transfer of title to the customer. Deposits received from customers and payments in advance for orders are recorded as liabilities under Customer Deposits until such time as orders are filled and title transfers to the customer consistent with our terms of sale.In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”("ASU") No. 2014-09, 2016-13, "Financial Instruments - Credit Losses (Topic 326)," which introduced an impairment model that is based on expected credit losses, rather than incurred losses, to estimate credit losses on certain types of financial instruments (e.g., loan commitments). The expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the contractual term. Financial instruments with similar risk characteristics may be grouped together when estimating expected credit losses. The Company adopted the new guidance, as of January 1, 2023, and it did not have a material impact on the Condensed Consolidated Financial Statements.Customers (Topic 606), which will supersedeCustomers. The core principle of the currentnew revenue recognition requirements9in Topic 605, Revenue Recognition. The standard’s core principlestandard is that a company willshould recognize revenue when it transfersto depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The new guidancefollowing five steps are applied to achieve that core principle:effectivea description of principal activities from which the Company generates its revenue.year beginningperformance obligation is recognized over the term of the license agreement (over time recognition). Conversely, when regulatory approval already exists or is probable, revenue is recognized at the point in time control of the product transfers to the customer.2018. The standard permits2023 and April 1, 2023. As of March 31, 2023, the useApril 1, 2023 installment has been recorded as a component of eitheraccrued liabilities and other current liabilities on the retrospective or cumulative effectaccompanying condensed consolidated balance sheet. To ensure that customer needs continue to be met after January 1, 2023, Baxter and Rockwell worked closely together to transition method. The Company is in the processcustomers’ purchases of evaluating how the new revenue recognition standard could impact the financial statements and disclosures. Rockwell’s hemodialysis concentrates from Baxter to Rockwell.our sales transactions, the new standardCompany’s U.S. and international customers, the Company recognizes revenue at the shipping point, which is not expectedgenerally the Company’s plant or warehouse. For other business, the Company recognizes revenue based on when the customer takes control of the product. The amount of revenue recognized is based on the purchase order less returns and adjusted for any rebates, discounts, chargebacks or other amounts paid to significantly changecustomers. There were no such adjustments for the periods reported. Customers typically pay for the product based on customary business practices with payment terms averaging 30 days, while a small subset of customers have payment terms averaging 60 days.In thousands of U.S. dollars ($) Three Months Ended March 31, 2023 Products By Geographic Area Total U.S. Rest of World Drug Revenues Product Sales – Point-in-time $ — $ — $ — License Fee – Over time 65 — 65 Total Drug Products 65 — 65 Concentrates Products Product Sales – Point-in-time 18,131 16,459 1,672 License Fee – Over time 1,472 1,472 — Total Concentrate Products 19,603 17,931 1,672 Net Revenue $ 19,668 $ 17,931 $ 1,737 In thousands of U.S. dollars ($) Three Months Ended March 31, 2022 Products By Geographic Area Total U.S. Rest of World Drug Revenues Product Sales – Point-in-time $ 159 $ 159 $ — License Fee – Over time 62 — 62 Total Drug Products 221 159 62 Concentrates Products Product Sales – Point-in-time 15,427 13,810 1,617 License Fee – Over time 476 476 — Total Concentrate Products 15,903 14,286 1,617 Net Revenue $ 16,124 $ 14,445 $ 1,679 new standard could impact the timing of revenue recognitionfollowing table provides information about receivables, contract assets, and contract liabilities from contracts with customers.In thousands of U.S. dollars ($) March 31, 2023 December 31, 2022 Accounts Receivable, net $ 6,021 $ 6,259 Contract liabilities, which are included in Deferred revenue $ 2,794 $ 4,331 up-frontany receivables arising from the Company’s contracts with customers for the three months ended March 31, 2023 and milestone2022.for licensing agreements. The new standard will also require expanded disclosures surroundingand consideration received from customers in advance of the customer assuming control of the related products.the notesany future year related to the financial statements. Cash and Cash EquivalentsWe consider cash on hand, money market funds, unrestricted certificates of deposit and short term marketable securities withremaining performance obligations, excluding revenue pertaining to contracts that have an original maturityexpected duration of 90 daysone year or less, contracts where revenue is recognized as cashinvoiced, and cash equivalents.Investments Available for SaleInvestments Available for Sale are short-term investments, consistingcontracts with variable consideration related to undelivered performance obligations, totaled $2.8 million as of investments in short term bond funds and in short term bonds and are stated at fair value based upon observed market prices (Level 1 in the fair value hierarchy).March 31, 2023. The portfolio generally consists of high credit quality short term debt instruments. These instruments are subject to changes in fair market value dueamount relates primarily to changesupfront payments and consideration received from customers in interest rates. advance of the customer assuming control of the related products. The Company applies the practical expedient in paragraph 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less.March 31, 2023 Amortized Cost Unrealized Gain Unrealized Loss Accrued Interest Fair Value Available-for-Sale Securities Debt securities $ 5,868 $ 72 $ — $ — $ 5,940 December 31, 2022 Amortized Cost Unrealized Gain Unrealized Loss Accrued Interest Fair Value Available-for-Sale Securities Debt securities $ 11,315 $ 75 $ — $ — $ 11,390 these investments was $35,028,841 as of September 30, 2017. Unrealized holding gains or losses on these securitiesavailable-for-sale are included in accumulated other comprehensive income (loss). Realized gains and losses, including declines in value judged to be other-than-temporary on available-for-sale securities are included as a component of other income or expense. Gross unrealized losses were $76,399 and gross unrealized gains were $35,274 as of September 30, 2017. There were realized gains of $57 and realized losses of $199,758 in the third quarter. For the nine months ended September 30, 2017, there were realized gains of $57 and realized losses of $704,752. The Company has evaluated the near term interest rate environment and the expected holding period of the investments along with the duration of the fund portfolios in assessing the severity and duration of potential impairments. Based on that evaluation the Company does not consider those investments to be other-than-temporarily impaired at September 30, 2017.Research and Product DevelopmentWe recognize research and product development expenses as incurred. We incurred product development and research costs related to the commercial development, patent approval and regulatory approval of new products aggregating approximately $4.2 million and $4.6 million for the nine months ended September 30, 2017 and 2016, respectively.Share Based CompensationWe measure the cost of employee and non-employee services received in exchange for equity awards, including stock options,determined using quoted market prices from daily exchange-traded markets based on the grantclosing price as of the balance sheet date and are classified as a Level 1 measurement under ASC 820 the awards in accordance with ASC 718-10, Compensation — Stock Compensation. The cost of equity based compensation is recognized as compensation expense over the vesting period of the awards.We estimate the fair value of compensation involving stock options utilizing the Black-Scholes option pricing model. This model requires the input of several factors such as the expected option term, expected volatility of our stock price over the expected option term, and an expected forfeiture rate, and is subject to various assumptions. We believe the valuation methodology is appropriate for estimating the fair value of stock options we grant to employees and directors which are subject to ASC 718-10 requirements. These amounts are estimates and thus may not be reflective of actual future results or amounts ultimately realized by recipients of these grants. 10
6. InventoryNet Earnings Per ShareWe computed our basic earnings (loss) per share using weighted average shares outstanding for each respective period. Diluted earnings per share also reflect the weighted average impact from the date of issuance of all potentially dilutive securities, consisting of stock options and common share purchase warrants, unless inclusion would have had an anti-dilutive effect. The calculation of basic weighted average shares outstanding excludes unvested restricted stock. Actual weighted average shares outstanding used in calculating basic and diluted earnings per share were:3. InventorySeptember 30, 2017March 31, 2023 and December 31, 20162022 are as follows:March 31,
2023December 31,
2022Inventory - Current Portion Inventory - Current Portion Raw Materials $ 2,806 $ 3,351 Work in Process 504 351 Finished Goods 2,285 2,112 Total Current Inventory Total Current Inventory 5,595 5,814 Inventory - Long Term Inventory - Long Term 1,276 1,276 Total Inventory Total Inventory $ 6,871 $ 7,090 September 30, 2017, weboth March 31, 2023 and December 31, 2022, the Company classified $1,494,175$1.3 million of inventory as non-current, all of which was related to Triferic raw materials. This Triferic inventory will be utilized for the active pharmaceutical ingredientCompany's international partnerships. The Company has discontinued its New Drug Applications ("NDAs") for Triferic.4. Baxter Distribution AgreementMarch 31,
2023December 31,
2022Leasehold Improvements $ 1,322 $ 1,256 Machinery and Equipment 6,001 5,922 Information Technology & Office Equipment 1,845 1,845 Laboratory Equipment 807 807 Total Property and Equipment 9,975 9,830 Accumulated Depreciation (7,796) (7,636) Property and Equipment, net $ 2,179 $ 2,194 March 31,
2023December 31,
2022Accrued Research & Development Expense $ — $ 43 Accrued Compensation and Benefits 1,804 2,568 Accrued Unvouchered Receipts 358 585 Accrued Workers Compensation 303 306 Other Accrued Liabilities 1,894 4,200 Total Accrued Liabilities $ 4,359 $ 7,702 2, 2014, wethe Company entered into the Baxter Agreement, which had a term of 10 years and received an upfront fee of $20 million. The upfront fee was recorded as deferred revenue and was being recognized based on the proportion of product shipments to Baxter in each period, compared with total expected sales volume over the term of the Distribution Agreement. On November 9, 2022, Rockwell reacquired its distribution rights to its hemodialysis concentrates products from Baxter and terminated the Distribution Agreement. Exclusivity and other provisions associated with the distribution agreement terminated November 9, 2022 and the remaining operational elements of the agreement terminated December 31, 2022. Rockwell agreed to provide certain services to a group of Baxter's customers until March 31, 2023. Under the Distribution Agreement, with Baxter pursuantdistributed and commercialized Rockwell’s hemodialysis concentrates products and provided customer service and order delivery to which Baxter becamenearly all United States customers. Following the Company’s exclusive agent for sales, marketing and distribution activities for the Company’sreacquisition of these rights, Rockwell is now unrestricted in its ability to sell its hemodialysis concentrate and ancillaryconcentrates products into dialysis clinics throughout the United States and various foreign countriesaround the world. The Company recognized the remaining revenue of $1.5 million during the three months ended March 31, 2023.termvalue of 10 years.$14.9 million. The DistributionCompany will assess at each reporting period whether conditions have changed to now meet the mandatorily redemptive definition which could trigger liability classification.As of March 31, Common stock and common stock equivalents: 2023 2022 Common stock 12,552,673 8,544,225 Common stock issuable upon exercise of pre-funded warrants 5,911,000 — Common stock and pre-funded stock warrants 18,463,673 8,544,225 Options to purchase common stock 1,194,202 511,117 Unvested restricted stock awards 891 891 Unvested restricted stock units 125,000 28,066 Convertible Preferred Stock 1,363,636 — Warrants to purchase common stock 10,196,268 2,402,442 Total 31,343,670 11,486,741 doeswith Cantor Fitzgerald & Co. as Agent, pursuant to which the Company may offer and sell from time to time up to $12,200,000 of shares of Company’s common stock through the Agent. The offering and sale of such shares has been registered under the Securities Act of 1933, as amended, pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-259923) (the “Registration Statement”), which was originally filed with the SEC on September 30, 2021 and declared effective by the SEC on October 8, 2021, the base prospectus contained within the Registration Statement, and a prospectus supplement that was filed with the SEC on April 8, 2022.includeexercise any portion of the Pre-Funded Warrants to the extent the holder would own more than 9.99% of the Company’s drugoutstanding common stock immediately after exercise, as such percentage ownership is determined in accordance with the terms of the Pre-Funded Warrant. The RD Purchase Agreement contains customary representations and warranties and agreements of the Company and the Purchaser and customary indemnification rights and obligations of the parties.Three Months Ended
March 31,2023 2022 Service-based awards: Restricted stock units $ 45 $ 12 Stock option awards 148 200 Total Service Based Awards 193 212 Performance-based awards: Restricted stock awards — (391) Total Performance Based Awards — (391) Total $ 193 $ (179) Number of Shares Weighted Average
Grant-Date
Fair ValueUnvested at January 1, 2023 891 $ 62.70 Unvested at March 31, 2023 891 $ 62.70 Number of Shares Weighted Average
Grant-Date
Fair ValueUnvested at January 1, 2022 7,118 $ 62.70 Forfeited (6,227) $ 62.70 Unvested at March 31, 2022 891 $ 62.70 Number of Shares Weighted Average
Grant-Date
Fair ValueUnvested at January 1, 2023 125,000 $ 1.47 Unvested at March 31, 2023 125,000 $ 1.47 Number of Shares Weighted Average
Grant-Date
Fair ValueUnvested at January 1, 2022 29,289 $ 12.87 Forfeited (1,223) 52.91 Unvested at March 31, 2022 28,066 $ 11.11 Shares
Underlying
OptionsWeighted
Average Exercise
PriceWeighted
Average
Remaining
Contractual
TermOutstanding at January 1, 2023 1,206,905 $ 8.32 8.9 Forfeited (8,083) 3.54 — Expired (4,620) 18.44 — Outstanding at March 31, 2023 1,194,202 $ 8.32 8.6 Exercisable at March 31, 2023 239,075 $ 28.45 6.7 Shares
Underlying
OptionsWeighted
Average Exercise
PriceWeighted
Average
Remaining
Contractual
TermOutstanding at January 1, 2022 528,591 $ 32.01 7.5 Granted 909 4.07 9.9 Forfeited (14,839) 17.49 — Expired (3,545) 85.36 — Outstanding at March 31, 2022 511,116 $ 32.01 7.0 Exercisable at March 31, 2022 230,858 $ 54.56 5.0 retainshad operating and finance lease liabilities of $6.2 million and right-of-use assets of $5.9 million, which are included in the condensed consolidated balance sheet.Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 Operating leases Operating lease cost $ 344 $ 449 Interest on lease obligations 60 — Variable lease cost 115 95 Operating lease expense 519 544 Finance leases Non-cash lease expense from right-of-use assets 141 141 Interest on lease obligations 39 47 Finance lease expense 180 188 Short-term lease rent expense 4 4 Total lease expense $ 703 $ 736 Other information Operating cash flows from operating leases $ 424 $ 464 Operating cash flows from finance leases $ 39 $ 47 Financing cash flows from finance leases $ 128 $ 118 Weighted-average remaining lease term – operating leases 2.8 3.4 Weighted-average remaining lease term – finance leases 4.2 5.2 Weighted-average discount rate – operating leases 6.4 % 6.3 % Weighted-average discount rate – finance leases 6.4 % 6.4 % Operating Finance Year ending December 31, 2023 (remaining) $ 1,249 $ 502 Year ending December 31, 2024 1,405 672 Year ending December 31, 2025 937 676 Year ending December 31, 2026 310 666 Year ending December 31, 2027 121 311 Total $ 4,022 $ 2,827 Less present value discount (335) (345) Operating and finance lease liabilities $ 3,687 $ 2,482 marketing and distribution rights for its hemodialysis concentrate products in specified foreign countriesof Triferic, with the latter beginning with the period ending December 31, 2020.hasin exchange for Innovatus lowering the sales covenants, agreed to (i) prepay an established commercial presence. On September 12, 2016, Baxter initiatedaggregate principal amount of $7.5 million in ten installments commencing on December 1, 2021; (ii) pay an arbitration proceeding against Rockwell in accordance with the International Institute for Conflict Prevention and Resolution, Inc.’s Rules for Non-Administered Arbitration under the Distribution Agreement alleging various breachesadditional prepayment premium of the Distribution Agreement, and Rockwell counterclaimed alleging various breaches by Baxter. On June 23, 2017,5% on prepaid amounts if the Company elects to prepay all outstanding Term Loans on or before September 24, 2023 and Baxter settled(iii) maintain minimum liquidity of no less than $5.0 million if the arbitration (the “Settlement”). The Settlement included a mutual release with respectaggregate principal amount of Term Loans is greater than $15 million pursuant to all known claims existing on the date ofliquidity covenant in the Settlement and the arbitration was dismissed with prejudice. No payments were made by either party in connection with the Settlement.In connection with the Settlement, on June 23, 2017,Loan Agreement. and Baxter entered into a FirstSecond Amendment to Exclusive Distributionthe Loan and Security Agreement and(the “Second Amendment”) dated as of November 14, 2022 with Innovatus, which amended the Loan Agreement. Pursuant to the Second Amendment, the Company (i) prepaid an aggregate principal amount of $5.0 million in Term Loans in one installment on November 14, 2022; (ii) shall pay interest only payments until September 2023 at which time will resume scheduled debt payments. Additionally, the financial covenants related to the trailing twelve months sales of Triferic was replaced with a First Amendmenttrailing 6 months revenue of our concentrates products beginning with the period ending September 30, 2022. The Company cannot assure that it can maintain compliance with the covenants under our Loan Agreement, which may result in an event of default. The Company's ability to Investmentcomply with these covenants may be adversely affected by events beyond its control. If the Company is unable to comply with the covenants under the Loan Agreement, it would pursue all available cure options in order to regain compliance. However, the Company may not be able to mutually agree with Innovatus on appropriate remedies to cure a future breach of a covenant, which could give rise to an event of default. If the Company is unable to avoid an event of default, any required repayments could have an adverse effect on its liquidity. The termsSettlement included, among other things, modified pricing that provides incentiveTerm Loan was $9.3 million, net of unamortized issuance costs and discount of $0.7 million.Principal Payments 2023 (remaining) 2,000 2024 6,000 2025 2,000 $ 10,000 BaxterCondensed Consolidated Financial Statementspursue new customersfinance various insurance policies. Principal and increase future sales. Our Settlementinterest payments related to this note began on July 3, 2022 and were paid on a straight-line amortization over 9 months with Baxterthe final payment due on March 3, 2023. As of March 31, 2023, the Company's insurance note payable was paid in full.not expected$0.0001 per share and resulted in gross proceeds to have a material impactthe Company of $119.10 (See Note 10 for more detail on our liquidity or results of operations.the Pre-Funded Warrants).11theour condensed consolidated financial statements and related notes in “Item 1. Condensed Consolidated Financial Statements and the Notes thereto included elsewhere in this report.Statements”. References in this report to “Rockwell,” the “Company,” “we,” “our” and “us” are references to Rockwell Medical, Inc. and its subsidiaries.“projected,“project,” “intend,” or similar expressions, or make statements regarding our intent, belief, or current expectations, we are making forward-looking statements. Our forward looking statements also include, without limitation, statements about our competitors, statements regarding Trifericliquidity and Calcitriol, statements relatingcapital resources; our ability to continue as a going concern; our Settlement with Baxterability to develop Ferric Pyrophosphate Citrate (“FPC”) for other indications; our ability to successfully execute on our business strategy and development of new indications; our ability to raise additional capital; our ability to renegotiate certain terms of our supply contracts; our ability to successfully implement certain cost containment and cost-cutting measures; our ability to achieve profitability and statements regarding our anticipated future financial condition, operating results, cash flows and business plans.We claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for all of our forward-looking statements. that our forward-looking statements are reasonable, you should not place undue reliance on any such forward-looking statements, which are based on information available to us on the date of this report or, if made elsewhere, as of the date made. Because these forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond our control or are subject to change, actual results could be materially different. Factors that might cause such a difference include, without limitation, the risks and uncertainties discussed in our quarterlythis report, for the period ended June 30, 2017 under “Part II - Item“Item 1A — Risk Factors” as modified in “Part II - Item 1A — Risk Factors” ofour Form 10-K for the year ended December 31, 2022 and from time to time in our other reports filed with the SEC, including in this report, as well as the risks listed below:Risks Related To Our Drug Business
Form 10-Q.·Although Triferic has been approved by the FDA, we may not be able to commercialize it successfully.·If we are unable to use our Triferic inventory before its shelf life expires, we may have to take a reserve which could have a material adverse effect on our results of operations and financial condition.·Our ability to market Triferic and other FDA-approved drugs is limited by the FDA to those specific indications and conditions for which clinical safety and efficacy have been demonstrated, which may limit our ability to market Triferic and our other drug products.·We depend on contract manufacturing organizations to manufacture our drug products. If these organizations are unable or unwilling to manufacture our drug products, or if these organizations fail to comply with FDA or other applicable regulations or otherwise fail to meet our requirements, our drug business will be harmed.·We rely on third party suppliers for raw materials and packaging components of our drug products. We may not be able to obtain the raw materials and proper components we need, or the cost of the materials or components may be higher than expected, any of which could impair our production or commercialization of drug products and have a material adverse effect on our results of operations, financial position and cash flows.·We may not be successful in obtaining foreign regulatory approvals or in arranging out-licensing partners capable of obtaining the approvals needed to effectively commercialize our drug products outside of the United States. Even if we are successful in out-licensing our drug products and obtaining the required regulatory approvals, the licensees or partners may not be effective at marketing our products in certain markets or at all.·We may not be successful in expanding our drug product portfolio or in our business development efforts related to in-licensing, acquisitions or other business collaborations. Even if we are able to enter into business development arrangements, they could have a negative impact on our business and our profitability.·Expansion of our drug business in the United States may require FDA approval of new drug candidates or indications for use. The process of obtaining FDA approval is a long and expensive process with no guarantee of success.·Our drug business depends on government funding of health care, and changes could impact our ability to be paid in full for our products, increase prices or cause consolidation in the dialysis provider market.·It may be difficult for us to capture market share for Calcitriol in the highly competitive generic drug market.12Risks Related To Our Concentrate Business·We may be required to repay a portion of the fees received from Baxter, which could materially and adversely affect our financial position and cash reserves.·A few customers account for a substantial portion of the end user sales of our concentrate products. The loss of any of these customers could have a material adverse effect on our results of operations and cash flow from our concentrate business.·The concentrate market is competitive and has a large competitor with substantial resources.·We may be affected materially and adversely by increases in raw material costs.Risks Related To Our Business As A Whole·Our drug and concentrate businesses are highly regulated, resulting in additional expense and risk of noncompliance that can materially and adversely affect our business, financial condition and results of operations.·Health care reform could adversely affect our business.·We depend on key personnel, the loss of which could harm our ability to operate.·Defending our intellectual property rights could be expensive, we may not always be successful in protecting our exclusive rights and we could be prevented from selling products, forced to pay damages and compelled to defend against litigation if we infringe the rights of a third party.·Our products may have undesirable side effects and our product liability insurance may not be sufficient to protect us from material liability or harm to our business.·Our business and operations would suffer in the event of a security breach, system failure, invasion, corruption, destruction or interruption of our or our business partners’ critical information technology systems or infrastructure.·We may be unable to obtain secured debt financing in the future as a result of our Distribution Agreement with Baxter.Risks Related To Our Common Stock·Shares eligible for future sale may affect the market price of our common shares.·The market price for our common stock is volatile.·Our ability to use our net operating loss carryforwards to offset potential taxable income and related income taxes that would otherwise be due may be limited.·We could have a material weakness in our internal control over financial reporting, which, until remedied, could result in errors in our financial statements requiring restatement of our financial statements. As a result, investors may lose confidence in our reported financial information, which could lead to a decline in our stock price.·Structural and anti-takeover provisions reduce the likelihood that you will receive a takeover premium.·We do not anticipate paying dividends in the foreseeable future.that future results will meet expectations. We do not undertakeForward-looking statements speak only as of the date of this report and we expressly disclaim any obligationintent to update or alter any statements whether as a result of new information, future events or otherwise, except as may be required by applicable law.fully-integrated pharmaceutical company targetingrevenue-generating business and the second largest supplier of acid and bicarbonate concentrates for dialysis patients in the United States. Hemodialysis is the most common form of end-stage renalkidney disease treatment and is usually performed at a freestanding outpatient dialysis center, at hospital-based outpatient center, at skilled nursing facilities, or in a patient’s home. This represents a large market opportunity for which Rockwell's products are well-positioned to meet the needs of patients.diseasedisease. While Rockwell has discontinued commercialization of Triferic in the United States, the Company has established several international partnerships with innovativecompanies seeking to develop and commercialize Trifericservicespricing our products appropriately to drive profitability.secondary hyperparathyroidismanemia in patients, who are receiving medications in the home infusion setting. During the second quarter 2022, Rockwell provided the FDA with supplemental data to be used in Rockwell’s clinical studies and hemodialysis. We areto clinically support the Company’s IND application for home infusion. The FDA placed this program on Clinical Hold and requested that additional data related to the microbiology and short-term stability of this formulation be provided to support the application. During the third quarter of 2022, Rockwell conducted a microbiological and short-term stability study of FPC for Home Infusion, in accordance with FDA guidance, to support the Company’s IND application. Preliminary results from the microbiology and short-term stability study indicated that the program would likely not meet the FDA’s requirements to support the IND application and would require significant capital expenditure and resources to support additional re-formulation work and conduct a Phase 2 trial. As a result, Rockwell has put development work associated with FPC for Home Infusion on hold.an established manufacturer and leader in delivering high-quality hemodialysis concentrates/dialysates to dialysis providers and distributorsexploring FPC’s impact on the treatment of hospitalized acute heart failure patients, which affects more than one million people in the United States and abroad. We supply approximately 25% of the United States domestic marketannually. Rockwell conducted a pre-IND meeting with dialysis concentrates and we also supply dialysis concentrates to distributors serving a number of foreign countries, primarily in the Americas and the Pacific Rim. Substantially all of our sales were concentrate products and related ancillary items.13Our business strategy is developing unique, proprietary renal drug therapies that we can commercialize or out-license, while also expanding our dialysis products business. These novel renal drug therapies support disease management initiatives to improve the quality of life and care of dialysis patients and are designed to deliver safe and effective therapy, while decreasing drug administration costs and improving patient convenience and outcome.Triferic is our lead branded drug. We believe it has the potential to capture significant market share due to its improved clinical and cost-saving benefits. Triferic received FDA approval in 2015, and is the only FDA-approved therapy indicated to replace iron and maintain hemoglobin in adult hemodialysis patients. Triferic received a reimbursement J-code, effective January 1, 2016. At about that time, we received clarification from CMS that Triferic would be included in the ESRD bundled payment which initiated our pursuit of separate reimbursement, which is available for new, innovative therapies. Although we cannot be certain, we believe that Triferic will receive separate reimbursement, which offers greater incentive for dialysis providers to adopt new, innovative therapies. We believe that Triferic will receive separate reimbursement as a result of our extensive efforts in working with policy makers. We have had in-depth discussions with high level officials within the current administration, key members of Congress, patient advocacy groups and other stakeholders regarding the merits of Triferic and why this innovative therapy should receive separate reimbursement, all of whom have been supportive of our efforts. We have had meetings with the leadership of the Department of Health and Human Services, the Centers for Medicare and Medicaid Services (CMS) and the Center for Medicare and Medicaid Innovation (CMMI). Upon their guidance, we have submitted a proposal to the Innovation Center at CMS. Among other advantages, the proposal highlights the improved clinical benefits that Triferic provides to patients, as well as the significant cost savings Triferic delivers to both Medicare and dialysis providers. Additionally, our key supporters in Congress and other influential agencies are encouraging CMS to immediately approve separate reimbursement for Triferic. We cannot predict the outcome or timing of the CMS review.Until the separate reimbursement issue is resolved for Triferic, we do not anticipate realizing significant revenues from Triferic sales. In the meantime, we continue to make progress in marketing to and educating our customers about Triferic and the valuable benefit it delivers by improving patient outcomes and lowering costs. We also continue to provide Triferic to dialysis providers via a drug sample program, receiving favorable response to the positive clinical and cost saving benefits. Our marketing and selling efforts to nephrologists and nurses, as well as to patients, are effective and being received favorably. We have built significant inventory of Triferic in anticipation of receiving separate reimbursement. If we are unable to successfully commercialize Triferic and achieve sufficient sales volumes over the next one to two years, we may have to write off a significant portion of our inventory investment in Triferic, which would have an adverse effect on our results of operations. As of September 30, 2017, we had $4.0 million of Triferic finished goods inventory that could expire within the next twelve months. We reserved $0.6 million in the third quarter for specific Triferic API batches that were determined to be in excess of our expected requirements over the next year and for which there was no plan to convert the API into finished goods. Our global strategy is to license Triferic to key partners to commercialize internationally. We are actively pursuing international licensing opportunities in a number of countries and regions. Additionally, we are continuing development work on other clinical indications related to iron deficiency that address unmet patient needs and we are evaluating opportunities to in-license other products that will complement our product portfolio. We are also working to begin marketing Calcitriol, generic injectable vitamin-D, which is manufactured through contract manufacturing organizations (“CMOs”). We received written notice from the FDA in October 2017 that2022 and will determine the FDA needed additional timepath forward for FPC in acute heart failure as the Company works toward profitability.revieweffect a reverse stock split of all outstanding shares of common stock, warrants and options. The Board of Directors subsequently approved the data submitted by us supporting Calcitriol.implementation of a reverse stock split at a ratio of one-for-eleven shares, which became effective on May 13, 2022. The notice contained no indication by FDACompany’s outstanding stock options were also adjusted to reflect the one-for-eleven reverse stock split of any deficiency with the data submitted. We expectCompany’s common stock. Outstanding stock options were proportionately reduced and the respective exercise prices, if applicable, were proportionately increased. The reverse stock split resulted in an adjustment to begin marketing Calcitriolthe Series X convertible preferred stock conversion prices to reflect a proportional decrease in the first quarternumber of 2018 assuming FDA approvalshares of common stock to be issued upon conversion. All share and per share data in this Form 10-Q hereto have been retroactively adjusted to the account for the effect of the submission.Rockwell sells its dialysis concentrates in the United States and certain foreign markets under the Distribution Agreement with Baxter. Rockwell receives a pre-defined gross profit margin on its concentrate products sold pursuant to the Distribution Agreement, subject to an annual true-up of costs. As discussed in more detail in Note 4 to the condensed consolidated financial statements, Baxter and Rockwell settled their contractual dispute and, as part of their settlement, modified pricing that provides incentive to Baxter to pursue new customers and increase future sales. The Settlement with Baxter is not expected to have a material impact on our liquidity or results of operations.14Nine Months Ended September 30, 2017 and September 30, 2016For the Three Months Ended March 31, 2023 % of Revenue 2022 % of Revenue % Change Net Sales $ 19,668 $ 16,124 22.0 % Cost of Sales 17,069 86.8 % 16,910 104.9 % 0.9 Gross Profit (Loss) 2,599 13.2 (786) (4.9) (430.7) Research and Product Development 278 1.4 1,567 9.7 (82.3) Selling and Marketing 498 2.5 455 2.8 9.5 General and Administrative 3,250 16.5 3,818 23.7 (14.9) Operating Loss $ (1,427) (7.3) % $ (6,626) (41.1) % (78.5) % Ourinwere $19.7 million compared to net sales of $16.1 million during the third quarter of 2017 were $14.6 million, $1.8 million or 14.1% higher than the third quarter of 2016.three months ended March 31, 2022. The increase of $3.5 million was primarily due to higher domestic concentratethe restructuring of our supply contract with DaVita, onboarding of new customers and increased pricing to other customers.$1.6$16.9 million which wasand a gross loss of $0.8 million during the three months ended March 31, 2022. Gross profit increased by $3.4 million primarily due to volume growththe restructuring of our supply contract with our domestic customers. Invoicing for pass through delivery costsDaVita, recognition of the remaining deferred revenue related to the termination of the Baxter increased approximately $0.6 million due to volume growthdistribution agreement (see Note 9), onboarding of new customers and increased expenses comparedpricing to other customers. As a result, the third quarterCompany expects an improvement in margins for the remainder of 2016. Our international sales were $0.2 million higher than the third quarter of 2016. Revenue recognized from licensing fees was the same as the third quarter of 2016.Our sales in the first nine months of 2017 were $42.5 million, an increase of $2.6 million or 6.4% over the first nine months of 2016. Our domestic concentrate sales increased $2.4 million or 6.9% over the first nine months of 2016 primarily due to increased sales volumes and additional pass through billings for delivery services to Baxter. Our international sales were $0.2 million higher than the first nine months of 2016. Our drug business revenue was not significant in the first nine months of 2017 or 2016. Gross ProfitGross profit in the third quarter of 2017 was $1.1million compared to $1.6 million in the third quarter of 2016.Gross profit margins were 7.3 % in the third quarter of 2017 compared to 12.3% in the third quarter of 2016. Our concentrate gross profit decreased $0.2 million due to lower pricing resulting from modifications to our contractual terms with Baxter. Our net drug business costs were approximately $0.3 million higher than the third quarter of 2016. Our drug business costs in the third quarter included inventory reserves of $0.7 million for inventory that was expected to be surplus to our requirements. Gross profit in the first nine months of 2017 was $4.9 million, an increase of $0.1 million or 3.4% over the first nine months of 2016. Gross profit margins were 11.6 % compared to 11.9% in the first nine months of 2016. The gross profit increase was primarily due to lower costs of $0.5 million related to our drug business operations for regulatory fees and value add taxes paid in connection with our execution of the Wanbang license agreement and partially offset by inventory reserves for surplus product. The increase in gross profit was partially offset by lower gross profit on the concentrate business of $0.4 million.Selling, General and Administrative ExpenseSelling, general and administrative expense during the third quarter of 2017 was $4.8 million compared to $5.1 million in the third quarter of 2016. The $0.3 million expense decrease was primarily due to lower equity compensation expenses of $0.9 million which was partially offset by higher legal costs, expenses related to shareholder activist activities and the contested 2017 annual meeting of $0.5 million.Selling, general and administrative expense during the first nine months of 2017 was $17.4 million compared to $15.1 million in the first nine months of 2016. The $2.3 million increase was primarily due to higher legal and professional costs relating to pending litigation, the Settlement with Baxter and the contested 2017 annual meeting. Equity compensation costs decreased by $1.8 million compared to the first nine months of 2016, partially offset by higher compensation and benefit costs of $0.5 million. Marketing costs for Triferic increased $0.4 million compared to the first nine months of 2016.We incurredand research costs related to the commercial development, patent approval and regulatory approval of new products, primarily Triferic, aggregating approximately $1.3expenses were $0.3 million and $1.3$1.6 million infor the third quarter of 2017three months ended March 31, 2023 and 2016,2022, respectively. Research and product development expenses decreased by $1.3 million due to greater cash management over project costs, incurreda reduction in headcount and the first nine months of 2017 and 2016 were $4.2 million and $4.6 million, respectively, and were largelydecision to put all research related to Triferic testing and development costsour FPC for use in other clinical indications and delivery presentations.15Interest and Investment Income, NetOur net interest and investment income in the third quarter of 2017 was $0.2 million less than the third quarter of 2016Home Infusion program on hold due to the repositioningsignificant capital expenditure and resources to support additional re-formulation work and conduct a Phase 2 trial.holdings in our short term bond portfolio in response$0.5 million is primarily due to market changes. Forimproved expense management and the first ninereduced usage of outside agencies.of 2017, we incurred a loss of $0.2 million compared to interest income of $0.6 million inended March 31, 2023 and 2022 was negligible. Other expense for the first ninethree months of 2016. Income Tax ExpenseWe recognized no income tax expense in the third quarter of 2017 or 2016. We recognized no income tax expense in the first nine months of 2017 compared to approximatelyended March 31, 2023 was $0.4 million in income taxof interest expense in the first nine months of 2016, which pertained to foreign income taxes paid related to license payments received underour debt facility (see Note 14 to the Wanbang license agreement.We believe we have adequate capital resources and liquidity to pursue our business strategy. In addition to operating our concentrate business, our strategy is centered on developing, marketing and licensing high potential drug products including Triferic.September 30, 2017,March 31, 2023, we had current assetsapproximately $16.8 million of $61.2 millioncash, cash equivalents and netinvestments available-for-sale, and working capital of $53.6$14.6 million. WeNet cash used in operating activities for the three months ended March 31, 2023 was approximately $3.9 million. Based on the currently available working capital, management believes the Company currently has sufficient funds to meet its operating requirements for at least the next twelve months from the date of the filing of this report.approximately $38.9 millioncaused, and may continue to cause, recession fears, rising interest rates, foreign exchange volatility and inflationary pressures. At this time, the Company is unable to quantify the potential effects of this economic instability on our future operations.cashthe past; however, current conditions in the financial and investments ascredit markets may limit the availability of September 30, 2017. Our usesfunding, refinancing or increase the cost of funding. Due to the rapidly evolving nature of the global situation, it is not possible to predict the extent to which these conditions could adversely affect the Company's liquidity and capital resources in the future.have primarily been for researchthat we will need to execute our business strategy is subject to many factors, including, but not limited to the costs associated with our manufacturing and transportation operations related to our concentrate business.development, investmentsportfolio. All of these strategies are subject to significant risks and uncertainties such that there can be no assurance we will be successful in inventoryachieving them. If we are unsuccessful in executing our business plan and we are unable to supportraise the required capital, we may be forced to curtail all of our drug product launchesactivities and, for operating expenses. ultimately, cease operations. Even if we are able to raise sufficient capital, such financings may only be available on unattractive terms, or result in significant dilution of stockholders’ interests and, in such event, the market price of our common stock may decline.$16.3$3.9 million for the three months ended March 31, 2023 compared to net cash used in operating activities of $9.8 million for the three months ended March 31, 2022. The decrease in cash used fromfirst nine monthsordinary course of 2017, which included research and development expensesbusiness of $4.2approximately $3.1 million, andincluding an increase in accounts payable of $2.4$1.1 million, a decrease in inventory levels. other liabilities of $3.3 million, a decrease in deferred revenue of $1.5 million for recognition of the remaining deferred revenue related to the termination of the Baxter distribution agreement and a decrease in prepaid and other assets of $0.5 million.increased our Trifericinventory over the last year in preparation for commercializing Triferichave evaluated all recently issued accounting pronouncements and believe wesuch pronouncements do not have adequate inventory to meet anticipated requirements. We have classified $1.5 million of Triferic’s active pharmaceutical ingredient as non-current inventory as of September 30, 2017 based on expected Triferic demand and production plans during 2018. The amount of non-current API inventory declined from the second quarter of 2017 primarily as a result of the conversion of API into finished goods during the third quarter. We anticipate that we will increasematerial effect our accounts receivable as we increase our drug product sales and we may also increase inventories to a more modest degree as we commercialize Triferic and Calcitriol. We also expect to continue investing in research and product development, such as clinical testing in connection with peritoneal dialysis, an orphan drug indication, pediatric indications and certain other indications, as we work to expand potential uses for Triferic. Future spending on such indications is expected to be minor in relationfinancial statements. See Note 3 to the Company’s cash resources. We believe that we have adequate capital resources to make these investmentscondensed consolidated financial statements included elsewhere in accounts receivable, inventory and research and product development. We expect to generate positive cash flow from operations when our drug products generate substantial sales. We have no long term debt as of September 30, 2017 and do not expect to incur interest expense in 2017. Capital expendituresthis Quarterly Report on our current facilities are not expected to materially exceed depreciation expense. Our capital expenditures were $0.7 million in the first nine months of 2017 compared to $0.3 million in the first nine months of 2016. We paid $2.3 million in withholding taxes in connection with restricted stock that vested in 2017 and for which we received common shares to be retired from the holders in accordance with the terms of the grants. The Company is in discussions with multiple potential business development partners to out‑license rights to Rockwell’s drug products outside the United States. Such licensing arrangements often include upfront fees, developmental milestone payments and royalties. If such licensing arrangements are negotiated for certain markets, we may receive such consideration in the future in addition to that which we are already entitled to receive under existing agreements. We are also considering other business development arrangements including joint ventures, partnerships and other transactions related to our products or other future products that we may develop or license.163. 3. Quantitative and Qualitative Disclosures Aboutabout Market RiskInterest Rate RiskWe have invested $35.0 millionavailable for sale securities that are invested in short term bonds and short term bond funds which typically yield higher returns than§229.10(f)(1) of Regulation S-K, is not required to provide the interest realized in money market funds. While these bonds and bond funds hold bonds of short duration, their market value is affecteddisclosure required by changes in interest rates. Increases in interest rates will reduce the market value of bonds held and we may incur unrealized losses from the reduction in market value of the bonds. If we sell some or all of our positions, those unrealized losses may result in realized losses which may or may not exceed the interest and dividends earned from those funds. However, due to the short duration of our portfolio of holdings, we do not believe that a hypothetical 100 basis point increase or decrease in interest rates will have a material impact on the value of our investments.Foreign Currency Exchange Rate RiskOur international business is conducted in U.S. dollars. It has not been our practice to hedge the risk of appreciation of the U.S. dollar against the predominant currencies of our trading partners. We have no significant foreign currency exposure to foreign supplied materials, and an immediate 10% strengthening or weakening of the U.S. dollar would not have a material impact on our shareholders’ equity or net income.Management is responsible for establishing and maintaining effectiveas defined under Rule 13a-15 of the Securities Exchange Act of 1934, as amended, that are designed to ensure that material information required to be disclosed in our reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’sSEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required financial disclosure. In designing and evaluating the disclosure controls and procedures, we recognized that a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Management necessarily was required to apply its judgment in evaluating the cost-benefitcost‑benefit relationship of possible controls and procedures.As of the end of the period covered by this report, we carried out an evaluation underourthe Company’s Chief Executive Officer, and Chief Financial Officer, ofwe evaluated the effectiveness of the design and operation of our disclosure controls and procedures.procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2023. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level, as of the end of the period covered by this report.have beenwere no changes in our internal control over financial reporting (as defined in connection with the evaluation required by Rule 13a-15 under13a-15(d) of the Exchange Act)Act that occurred during the most recently completed fiscal quarterperiod covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.Richmond/Ravich LitigationOn March 8, 2017, Rockwell filed suit in the United States District Court for the Eastern District of Michigan against Richmond Brothers, Inc. and certain related entities, David S. Richmond, Mark H. Ravich and certain related trusts, and Matthew J. Curfman (“Richmond/Ravich Defendants”), and three individual Rockwell shareholders: Jay F. Joliat, Chris17Paxos, and David Hagelstein (together with the “Richmond/Ravich Defendants,” the “Rockwell Shareholders”). Since then, Rockwell voluntarily dismissed its claims against two of the individual shareholders, Chris Paxos and David Hagelstein. Rockwell’s complaint alleges that the Rockwell Shareholders failed to timely file a Schedule 13D and that a Schedule 13G and Schedules 13D filed by the Richmond/Ravich Defendants contained various material misstatements and omissions, in violation of Section 13(d) of the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, and the rules promulgated thereunder by the Securities and Exchange Commission. The complaint seeks declaratory and injunctive relief relating to these alleged violations, including requiring the Rockwell Shareholders to file new or amended Schedules 13D disclosing the proper date of their shareholder group’s formation and providing accurate information about the group’s membership and activities, and issuing a declaratory judgment finding that the Rockwell Shareholders violated Section 13(d) of the Exchange Act. On June 28, 2017, the Court denied the Richmond/Ravich Defendants’ motion to dismiss this case, in which Defendant Jay F. Joliat had joined. On August 24, 2017, the Richmond/Ravich Defendants answered the Complaint, and Defendant Mark H. Ravich asserted counterclaims against Rockwell alleging that he was denied access to corporate books, not properly notified of a Board of Directors meeting, and that certain settlement agreements with Baxter Healthcare Corporation (“Baxter”) and former Defendant David Hagelstein violate Michigan law. Defendant Ravich also asserted claims against Baxter and Mr. Hagelstein as third party “relief” defendants. On September 19, 2017, Rockwell moved for leave to amend the Complaint to add allegations regarding misstatements in the Richmond/Ravich Defendants’ Schedule 13(d) concerning the voting power of Richmond Brothers, Inc. and Mr. Richmond. The Richmond/Ravich Defendants have opposed this Motion. On September 28, 2017, Rockwell moved to dismiss Counts II-IV of Defendant Ravich’s Counterclaims. The hearing on Rockwell’s Motion to Dismiss is scheduled for December 13, 2017. The parties are currently engaged in discovery, with the trial in this case set for July 2018.Other Proceedingsaremay be involved in certain otherroutine legal proceedings from time to time before various courts and governmental agencies. We cannot predict the final disposition of such proceedings. We regularly review legal matters and record provisions for claims that are considered probable of loss. The resolution of these pending proceedings is not expected to have a material effect on our operations or consolidated financial statements in the period in which they are resolved.2029 provides sufficient protection of the Company’s interest in Triferic and that it is in the Company’s best interest to no longer pursue an extension under the Hatch-Waxman Act of the earlier Triferic patents as to which it has a license. As a result, the Company has withdrawn its election under the Hatch-Waxman Act and those patents have now expired. In light of these actions, the risk factor entitled “If we do not obtain protection under the Hatch-Waxman Act to extend patent protection for Triferic, our drug business may not reach its full potential.” is no longer a material risk. In addition, as set forth below, the Company has expanded the risk factor entitled “Defending our intellectual property rights could be expensive, we may not always be successful in protecting our exclusive rights and we could be prevented from selling products, forced to pay damages and compelled to defend against litigation if we infringe the rights of a third party.” Defending our proprietary rights could be expensive, we may not always be successful in protecting our intellectual property, licenses and other proprietary rights and we could be prevented from selling products, forced to pay royalties and damages and compelled to defend against litigation if we infringe the rights of a third party.Our success, competitive position and future revenues, particularly with respect to our drug products, will depend in part on our ability to obtain and maintain proprietary protection for our products, methods, processes and other technologies, to preserve our trade secrets, to prevent third parties from infringing on our proprietary rights and to operate without infringing the proprietary rights of third parties. There can be no assurance that these protections will prove commercially valuable.We could incur substantial costs in seeking enforcementPart I, Item 1A of our proprietary rights, and we cannot guarantee that we will prevail in any legal action seeking enforcement or that such rights will successfully preclude others from using technology that we rely upon. It is possible that we may infringeAnnual Report on proprietary rights of others, even if we are not aware18of the infringement or believe our rights are otherwise valid. If a third party believes that one of our products infringes on the third party’s rights, it may sue us even if we have received our own patent protectionForm 10-K for the technology or otherwise believe we have valid proprietary rights. If we are found by a court to have infringed the rights of a third party, we could be prevented from manufacturing and selling products, forced to pay royalties and damages, compelled to license technology from the party claiming infringement and lose the opportunity to license our technology to others and collect royalty payments, any of which could have a material adverse effect on our business. In addition, if Baxter is prevented from selling any of our concentrate or ancillary products due to a patent infringement or if its ability to sell any of our concentrate or ancillary products due to a patent infringement is materially and adversely affected, Baxter may be entitled to terminate our Distribution Agreement and obtain a refund of a portion of the upfront fee and facility fee.Other than the foregoing, thereyear ended December 31, 2022. There have been no material changes to the risk factors set forth in our quarterly report for the period ended June 30, 2017 under “Part II - Item 1A — Risk Factors”, which amended and restated the risk factors in “Item 1A Risk Factors” of ourAnnual Report on Form 10-K for the year ended December 31, 2016.following documents areexhibits filed or furnished as part of this report or were previously filed andQuarterly Report on Form 10-Q are set forth on the Exhibit Index, which Exhibit Index is incorporated herein by reference to the filing indicated. Exhibits not required for this report have been omitted. Our Commission file number is 000-23661.reference.Exhibit No.DescriptionExhibit No. Description 10.70Form of Director and Officer Indemnification Agreement September 201710.71Stock Appreciation Right Agreement, dated September 5, 2017, between the Company and John G. Cooper.31.131.1* 31.232.1101.INS101.SCH101.CAL101.DEF101.LAB101.PRE104* The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, formatted in Inline XBRL (included as Exhibit 101) * Filed herewith ** Furnished herewith and not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act 19Date: May 15, 2023 /s/ Mark Strobeck Date: November 8, 2017/s/ ROBERT L. CHIOINIRobert L. ChioiniPresident and Mark Strobeck, Ph.D.
Chief Executive Officer(principal executive officer) (duly authorized officer)Date: November 8, 2017/s/ THOMAS E. KLEMAThomas E. KlemaVice President and Chief Financial Officer(principal financial officer and principal accounting officer)20