Business Combinations

3 Months Ended

Mar. 31, 2026

Business Combination And Asset Acquisition [Abstract]

2. Business Combinations

On October 7, 2025 (the "Merger Date"), the Company completed its merger with scPharmaceuticals Inc. ("scPharma") at a price of $5.35 per share in cash plus one non-tradable contingent value right ("CVR") per share, which represents the right to receive up to an aggregate amount of $1.00 per CVR in cash upon the achievement of certain regulatory and net sales milestones on or prior to the applicable milestone outside dates, for total consideration of up to $6.35 per share in cash, representing a total equity value of approximately $303.8 million and representing a total deal value of up to approximately $363.5 million if the CVR milestones are achieved at the maximum payment amount.

Accounting Treatment

The merger with scPharma was accounted for as a business combination using the acquisition method of accounting, which requires the assets acquired and liabilities assumed to be recognized at their respective fair values as of the Merger Date and resulted in the recognition of a developed technology intangible asset of $194.0 million and an IPR&D intangible asset of $129.6 million. The excess of purchase price over the fair value of the net assets acquired in this transaction was recorded as $65.7 million in goodwill. See Note 7 – Goodwill and Other Intangible Assets.

The fair value of the acquired developed technology related to the on-body infusor and the IPR&D were derived using an income approach, specifically a projected discounted cash flow method, adjusted for the probability of regulatory and commercial success. The projected discounted cash flow models used to estimate the Company’s Developed technology and IPR&D reflect significant assumptions regarding the estimates a market participant would make in order to evaluate a commercial drug and a drug development asset, including the following:

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The extent, character and utility of the intangible assets

•

The cost-savings attributes of the intangible assets

•

The nature of the functional or economic obsolescence of each intangible asset, and,

•

The relative risk and uncertainty associated with an investment in intangible assets

The determination of the fair value of the developed technology and IPR&D intangible assets as such, required management to make significant estimates and assumptions related to future cash flows and the discount rate. The discount rates used in the determination of fair value for developed technology and IPR&D were both 23% and both used a royalty rate of 10%. The developed technology and IPR&D are both level 3 in the fair value hierarchy described above in Note 1 – Description of Business and Significant Accounting Policies.

Contingent Value Right ("CVR")

The contingent consideration for the CVR is included in Contingent consideration - short term and Contingent consideration - long term in the table above and in the consolidated balance sheets and is achieved through the following milestones:

Milestone 1: Receipt of FDA approval of a drug-device combination product comprising high concentration furosemide (the "ReadyFlow Formulation") delivered either in an autoinjector or a self-dose injection delivery system (such milestone, “Milestone 1”) with (a) $0.75 per CVR if Milestone 1 is achieved by September 30, 2026, (b) $0.50 per CVR if Milestone 1 is achieved by December 31, 2026 and (c) $0.25 per CVR if Milestone 1 is achieved by June 30, 2027.

Milestone 2: Achievement in any trailing consecutive 12-month period ending prior to and including December 31, 2026 of at least $110.0 million of worldwide net sales of Furoscix and, if any, the ReadyFlow Formulation (collectively, the “Products”) in such 12-month period (“Milestone 2”) with (a) $0.25 per CVR upon the achievement of $120.0 million of worldwide net sales in such period and (b) between $0.10 and $0.25 per CVR if, as of December 31, 2026, the highest worldwide net sales in any trailing 12-month period were between $110.0 million and $120.0 million, which payment will be calculated on a straight-line basis such that the payment per CVR increases proportionally as worldwide net sales increase from $110.0 million to $120.0 million. Milestone 2 will not be achieved if trailing worldwide net sales are less than $110.0 million during this period. No payment shall be made if the highest worldwide net sales in any trailing twelve-month period are less than $110.0 million.

The CVR was valued using both a Scenario-Based Method for Milestone 1 and a Monte Carlo Simulation Method for Milestone 2 to estimate the probability of success. The probability adjusted cash flow included significant estimates and assumptions pertaining to commercialization events and net sales received by the Company during the term of the CVR Agreement (as discussed above). See Note 11 – Fair Value of Financial Instruments for the key assumptions used in determining fair value.

The contingent consideration liability is remeasured each subsequent reporting period until the related contingencies have been resolved. For the three months ended March 31, 2026, the Company recorded $2.8 million to other expense as a result of the remeasurement of the fair value of the contingent consideration liability obtained from the acquisition of scPharma. The following table summarizes the activities within the account balance as of March 31, 2026 (in thousands):


Beginning balance as of January 1, 2026	$	26,246
Fair value changes		2,777
Balance as of March 31, 2026	$	29,023

Measurement period adjustments

During the three months ended March 31, 2026, the Company did not record any measurement period adjustments to its acquired assets and liabilities. The Company expects to finalize the purchase price allocation within the one year measurement period, ending October 7, 2026.

- Definition

The entire disclosure for business combination.

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+ Details

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