Chloroprocaine Hydrochloride

Revenues of $47.8 million, a 38% increase over $34.6 million recorded in prior-year period VEVYE revenues increased to $21.5 million, a 35% increase from $16.0 million in the fourth quarter 2024 Cash flow from operations reached a record high of $19.7 million GAAP net loss of $(17.8) million Adjusted EBITDA of $(2.0) million Cash and cash equivalents of $66.7 million as of March 31, 2025 VEVYE ® Access for All launch in mid-March is accelerating market share capture and revenue growth NASHVILLE, Tenn.--(BUSINESS WIRE)--Harrow (Nasdaq: HROW), a leading North American eyecare pharmaceutical company, announced results for the first quarter ended March 31, 2025. The Company also posted its first quarter Letter to Stockholders and corporate presentation to the “Investors” section of its website, harrow.com. The Company encourages all Harrow stockholders to review these documents, which provide additional details concerning the historical quarterly period and future expectations for the business. “During the first quarter, the Harrow team advanced key commercial initiatives to drive 2025 demand for VEVYE®, IHEEZO®, and TRIESENCE®, including the mid-March launch of the VEVYE® Access for All (VAFA) program,” said Mark L. Baum, Chief Executive Officer of Harrow. “Despite typical first quarter seasonality and initiatives like VAFA, which launched late in the first quarter, we grew revenues by 38% year‑over‑year. We saw a 35% quarter‑over‑quarter increase in VEVYE revenues from $16.0 million in the fourth quarter of 2024 to $21.5 million in the first quarter of 2025. Notably, beginning early in the second quarter, we’ve seen a meaningful acceleration in unit demand across our portfolio as year-end stocking inventories were largely depleted, and various commercial initiatives gained traction, providing momentum we expect to continue to build throughout 2025. “Early VAFA program data has been very promising, with new VEVYE prescription volumes at PhilRx more than quadrupling and prescribers increasing by over 4X, all while maintaining a strong average selling price. Our VEVYE refill rate continues to be buoyant, with the average covered patient receiving nine refills. Given these trends, we believe VEVYE is now poised to become Harrow's first product to generate annual nine-figure revenue. With the current order flow and potential unit demand expected from soon-to-close pipeline accounts for IHEEZO, TRIESENCE, and other operational improvements across the rest of our business, we remain confident that we will achieve – and hopefully exceed – our 2025 revenue target of over $280 million. We also remain committed to pursuing strategic acquisitions that add high-quality ophthalmic pharmaceutical assets to our best-in-class U.S. commercial platform.” First-quarter 2025 figures of merit: For the Three Months Ended March 31, 2025 2024 Total revenues $ 47,831,000 $ 34,587,000 Gross margin 68 % 69 % Core gross margin(1) 75 % 76 % Net loss (17,780,000 ) (13,565,000 ) Core net loss(1) (13,554,000 ) (9,789,000 ) Adjusted EBITDA(1) (1,985,000 ) 227,000 Basic and diluted net loss per share (0.50 ) (0.38 ) Core basic and diluted net loss per share(1) (0.38 ) (0.28 ) (1) Core gross margin, core net loss, core basic and diluted net loss per share (collectively, “Core Results”), and Adjusted EBITDA are non‑GAAP measures. For additional information, including a reconciliation of such Core Results and Adjusted EBITDA to the most directly comparable measures presented in accordance with GAAP, see the explanation of non‑GAAP measures and reconciliation tables at the end of this release. Conference Call and Webcast The Company’s management team will host a conference call and live webcast tomorrow morning, Friday, May 9, 2025, at 8:00 a.m. Eastern time to discuss the first-quarter 2025 results and provide a business update. Participants can access the live conference call via webcast on the “Investors” page of Harrow’s website. To participate via telephone, please register in advance using this link. Upon registration, all telephone participants will receive a confirmation email with detailed instructions, including a unique dial‑in number and PIN, for accessing the call. A replay of the conference call webcast will be archived on the Company’s website for one year. About Harrow Harrow, Inc. (Nasdaq: HROW) is a leading eyecare pharmaceutical company engaged in the discovery, development, and commercialization of innovative ophthalmic pharmaceutical products for the North American market. Harrow helps eyecare professionals preserve the gift of sight by making its portfolio of pharmaceutical products accessible and affordable to millions of patients each year. For more information about Harrow, please visit harrow.com. Forward-Looking Statements This press release contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Any statements in this release that are not historical facts may be considered such “forward‑looking statements.” Forward-looking statements are based on management's current expectations and are subject to risks and uncertainties which may cause results to differ materially and adversely from the statements contained herein. Some of the potential risks and uncertainties that could cause actual results to differ from those predicted include, among others, risks related to: liquidity or results of operations; our ability to successfully implement our business plan, develop and commercialize our products, product candidates and proprietary formulations in a timely manner or at all, identify and acquire additional products, manage our pharmacy operations, service our debt, obtain financing necessary to operate our business, recruit and retain qualified personnel, manage any growth we may experience and successfully realize the benefits of our previous acquisitions and any other acquisitions and collaborative arrangements we may pursue; competition from pharmaceutical companies, outsourcing facilities and pharmacies; general economic and business conditions, including inflation and supply chain challenges; regulatory and legal risks and uncertainties related to our pharmacy operations and the pharmacy and pharmaceutical business in general, including the ongoing communications with the U.S. Food and Drug Administration relating to compliance and quality plans at our outsourcing facility in New Jersey; physician interest in and market acceptance of our current and any future formulations and compounding pharmacies generally. These and additional risks and uncertainties are more fully described in Harrow’s filings with the Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2024, subsequent Quarterly Reports on Form 10-Q, and other filings with the SEC. Such documents may be read free of charge on the SEC's web site at sec.gov. Undue reliance should not be placed on forward‑looking statements, which speak only as of the date they are made. Except as required by law, Harrow undertakes no obligation to update any forward‑looking statements to reflect new information, events, or circumstances after the date they are made, or to reflect the occurrence of unanticipated events. HARROW, INC. CONDENSED CONSOLIDATED BALANCE SHEETS March 31, 2025 December 31, 2024 (unaudited) ASSETS Cash and cash equivalents $ 66,726,000 $ 47,247,000 All other current assets 102,809,000 142,404,000 Total current assets 169,535,000 189,651,000 All other assets 194,629,000 199,320,000 TOTAL ASSETS $ 364,164,000 $ 388,971,000 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities $ 186,986,000 $ 91,343,000 Loans payable, net of unamortized debt discount and current portion 112,501,000 219,539,000 All other liabilities 8,581,000 8,792,000 TOTAL LIABILITIES 308,068,000 319,674,000 TOTAL STOCKHOLDERS' EQUITY 56,096,000 69,297,000 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 364,164,000 $ 388,971,000 HARROW, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS For the Three Months Ended March 31, 2025 2024 Total revenues $ 47,831,000 $ 34,587,000 Cost of sales (15,524,000 ) (10,553,000 ) Gross profit 32,307,000 24,034,000 Selling, general and administrative 40,513,000 28,813,000 Research and development 3,026,000 2,149,000 Total operating expenses 43,539,000 30,962,000 Loss from operations (11,232,000 ) (6,928,000 ) Total other expense, net (6,548,000 ) (6,637,000 ) Income tax - - Net loss attributable to Harrow, Inc. $ (17,780,000 ) $ (13,565,000 ) Basic and diluted net loss per share $ (0.50 ) $ (0.38 ) HARROW, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 2025 2024 Net cash provided by (used in): Operating activities $ 19,668,000 $ (4,628,000 ) Investing activities (212,000 ) (110,000 ) Financing activities 23,000 (809,000 ) Net change in cash and cash equivalents 19,479,000 (5,547,000 ) Cash and cash equivalents at beginning of the period 47,247,000 74,085,000 Cash and cash equivalents at end of the period $ 66,726,000 $ 68,538,000 Non-GAAP Financial Measures In addition to the Company’s results of operations determined in accordance with U.S. generally accepted accounting principles (GAAP), which are presented and discussed above, management also utilizes Adjusted EBITDA and Core Results, unaudited financial measures that are not calculated in accordance with GAAP, to evaluate the Company’s financial results and performance and to plan and forecast future periods. Adjusted EBITDA and Core Results are considered “non‑GAAP” financial measures within the meaning of Regulation G promulgated by the SEC. Management believes that these non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results, provide a more complete understanding of the Company’s results of operations and the factors and trends affecting its business. Management believes Adjusted EBITDA and Core Results provide meaningful supplemental information regarding the Company’s performance because (i) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making; (ii) they exclude the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company’s core operating performance and that may obscure trends in the Company’s core operating performance; and (iii) they are used by institutional investors and the analyst community to help analyze the Company’s results. However, Adjusted EBITDA, Core Results, and any other non‑GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further, non‑GAAP financial measures used by the Company and the way they are calculated may differ from the non-GAAP financial measures or the calculations of the same non‑GAAP financial measures used by other companies, including the Company’s competitors. Adjusted EBITDA The Company defines Adjusted EBITDA as net loss, excluding the effects of stock‑based compensation and expenses, interest, taxes, depreciation, amortization, investment loss, net, and, if any and when specified, other non-recurring income or expense items. Management believes that the most directly comparable GAAP financial measure to Adjusted EBITDA is net loss. Adjusted EBITDA has limitations and should not be considered as an alternative to gross profit or net loss as a measure of operating performance or to net cash provided by (used in) operating, investing, or financing activities as a measure of ability to meet cash needs. The following is a reconciliation of Adjusted EBITDA, a non-GAAP measure, to the most comparable GAAP measure, net loss, for the three months ended March 31, 2025 and for the same period in 2024: HARROW, INC. RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA For the Three Months Ended March 31, 2025 2024 GAAP net loss $ (17,780,000 ) $ (13,565,000 ) Stock-based compensation and expenses 4,556,000 4,169,000 Interest expense, net 6,548,000 5,415,000 Income tax - - Depreciation 465,000 432,000 Amortization of intangible assets 4,226,000 2,554,000 Investment loss, net - 1,248,000 Other income, net - (26,000 ) Adjusted EBITDA $ (1,985,000 ) $ 227,000 Core Results Harrow Core Results, including core gross margin, core net loss, and core basic and diluted loss per share exclude (1) all amortization and impairment charges of intangible assets, excluding software development costs, (2) net gains and losses on investments and equity securities, including equity method gains and losses and equity valued at fair value through profit and loss (FVPL), and preferred stock dividends, and (3) gains/losses on forgiveness of debt. In certain periods, Core Results may also exclude fair value adjustments of financial assets in the form of options to acquire a company carried at FVPL, obligations related to product recalls, certain acquisition‑related items, restructuring charges/releases and associated items, related legal items, gains/losses on early extinguishment of debt or debt modifications, impairments of property, plant and equipment and software, as well as income and expense items that management deems exceptional and that are or are expected to accumulate within the year to be over a $100,000 threshold. The following is a reconciliation of Core Results, non-GAAP measures, to the most comparable GAAP measures for the three months ended March 31, 2025 and 2024: For the Three Months Ended March 31, 2025 GAAP Results Amortization of Certain Intangible Assets Investment Gains (Losses) Other Items Core Results Gross profit $ 32,307,000 $ 3,780,000 $ - $ - $ 36,087,000 Gross margin 68 % 75 % Operating loss (11,232,000 ) 4,226,000 - - (7,006,000 ) Loss before taxes (17,780,000 ) 4,226,000 - - (13,554,000 ) Taxes - - - - - Net loss (17,780,000 ) 4,226,000 - - (13,554,000 ) Basic and diluted loss per share ($)(1) (0.50 ) (0.38 ) Weighted average number of shares of common stock outstanding, basic and diluted 35,826,452 35,826,452 For the Three Months Ended March 31, 2024 GAAP Results Amortization of Certain Intangible Assets Investment Gains (Losses) Other Items Core Results Gross profit $ 24,034,000 $ 2,140,000 $ - $ - $ 26,174,000 Gross margin 69 % 76 % Operating loss (6,928,000 ) 2,554,000 - - (4,374,000 ) Loss before taxes (13,565,000 ) 2,554,000 1,248,000 (26,000 ) (9,789,000 ) Taxes - - - - - Net loss (13,565,000 ) 2,554,000 1,248,000 (26,000 ) (9,789,000 ) Basic and diluted loss per share ($)(1) (0.38 ) (0.28 ) Weighted average number of shares of common stock outstanding, basic and diluted 35,469,638 35,469,638 (1) Core basic and diluted loss per share is calculated using the weighted-average number of shares of common stock outstanding during the period. Core basic and diluted loss per share also contemplates dilutive shares associated with equity‑based awards as described in Note 2 and elsewhere in the Consolidated Financial Statements included in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025.

Record revenues of $66.8 million for Q4 2024, an 84% increase over Q4 2023 Revenues of $199.6 million for FY 2024, a 53% increase over FY 2023 GAAP net income of $6.8 million for Q4 2024, for a GAAP net loss of $(17.5) million for FY 2024 Adjusted EBITDA of $22.5 million for Q4 2024, leading to Adjusted EBITDA of $40.3 million for FY 2024 IHEEZO® unit demand and VEVYE® prescriptions for Q4 2024 each increased over 40% over Q3 2024 VEVYE® Access for All program expected to drive continued market share expansion in 2025 TRIESENCE® transitional pass-through approved, significantly increasing addressable market opportunity NASHVILLE, Tenn.--(BUSINESS WIRE)--Harrow (Nasdaq: HROW), a leading North American eyecare pharmaceutical company, announced results for the fourth quarter and year ended December 31, 2024. The Company also posted its fourth quarter Letter to Stockholders and corporate presentation to the “Investors” section of its website, harrow.com. The Company encourages all Harrow stockholders to review these documents, which provide additional details concerning the historical quarterly period and future expectations for the business. “Our stellar fourth-quarter performance, including an 84% year-over-year increase in revenues to a record $66.8 million, marked the end of a monumental year for Harrow, with 2024 revenues rising 53% over 2023 to $199.6 million,” said Mark L. Baum, Chief Executive Officer of Harrow. “This strong finish, driven by over 40% quarter-over-quarter growth in both IHEEZO unit demand and VEVYE prescriptions, showcases market uptake for our expanding portfolio and the overall success of the Harrow team. We expect our momentum to continue in 2025, particularly in the second half, as the recently announced VEVYE Access for All program gains traction – accelerating market share capture, expanding commercially covered prescriptions, and bolstering prescriber confidence by ensuring their patients can affordably start treatment with VEVYE, regardless of insurance status. Meanwhile, in addition to our success in stabilizing the supply chain for TRIESENCE, the Centers for Medicare & Medicaid Services recently approved our transitional pass-through application, significantly increasing its addressable market. This terrific news should add fuel to our commercial efforts concurrent with our development of a next-generation version of this high-value and high-trust product. Because we remain at the initial stages of market penetration for our core products, we expect revenue growth in these cornerstone products for years to come.” Baum added, “We continue to review new ways to better serve our customers and leverage our commercial infrastructure by adding attractive low-risk, high-return products. This includes product candidates we have been quietly nurturing internally, which we expect to discuss in more detail later this year; those being brought to us by third parties; and those in which we already have a stake, such as the MELT-300 program. Finally, Harrow stockholders should know that while we expect normal seasonal revenue fluctuations, we are confident in the remainder of 2025, as demonstrated by our 2025 revenue guidance of ‘more than $280 million,’ representing an increase over 2024 revenue of more than 40% in annual revenues.” Fourth-quarter and year-end 2024 figures of merit: For the Three Months Ended December 31, For the Year Ended December 31, 2024 2023 2024 2023 Total revenues $ 66,831,000 $ 36,355,000 $ 199,614,000 $ 130,193,000 Gross margin 79 % 69 % 75 % 70 % Core gross margin(1) 84 % 75 % 80 % 77 % Net income (loss) 6,777,000 (9,148,000 ) (17,481,000 ) (24,411,000 ) Core net income (loss)(1) 11,366,000 (7,016,000 ) (2,089,000 ) (11,512,000 ) Adjusted EBITDA(1) 22,489,000 2,563,000 40,327,000 28,119,000 Net income (loss) per share: Basic 0.19 (0.26 ) (0.49 ) (0.75 ) Diluted 0.24 (0.26 ) (0.49 ) (0.75 ) Core net income (loss) per share:(1) Basic 0.32 (0.20 ) (0.06 ) (0.35 ) Diluted 0.40 (0.20 ) (0.06 ) (0.35 ) (1) Core gross margin, core net income (loss), core basic and diluted net income (loss) per share (collectively, “Core Results”), and Adjusted EBITDA are non‑GAAP measures. For additional information, including a reconciliation of such Core Results and Adjusted EBITDA to the most directly comparable measures presented in accordance with GAAP, see the explanation of non‑GAAP measures and reconciliation tables at the end of this release. Conference Call and Webcast The Company’s management team will host a conference call and live webcast tomorrow morning, Friday, March 28, 2025, at 8:00 a.m. Eastern time to discuss the fourth-quarter and year-end 2024 results and provide a business update. Participants can access the live conference call via webcast on the “Investors” page of Harrow’s website. To participate via telephone, please register in advance using this link. Upon registration, all telephone participants will receive a confirmation email with detailed instructions, including a unique dial-in number and PIN, for accessing the call. A replay of the conference call webcast will be archived on the Company’s website for one year. About Harrow Harrow, Inc. (Nasdaq: HROW) is a leading eyecare pharmaceutical company engaged in the discovery, development, and commercialization of innovative ophthalmic pharmaceutical products for the North American market. Harrow helps eyecare professionals preserve the gift of sight by making its portfolio of pharmaceutical products accessible and affordable to millions of patients each year. For more information about Harrow, please visit harrow.com. Forward-Looking Statements This press release contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Any statements in this release that are not historical facts may be considered such “forward-looking statements.” Forward-looking statements are based on management's current expectations and are subject to risks and uncertainties which may cause results to differ materially and adversely from the statements contained herein. Some of the potential risks and uncertainties that could cause actual results to differ from those predicted include, among others, risks related to: liquidity or results of operations; our ability to successfully implement our business plan, develop and commercialize our products, product candidates and proprietary formulations in a timely manner or at all, identify and acquire additional products, manage our pharmacy operations, service our debt, obtain financing necessary to operate our business, recruit and retain qualified personnel, manage any growth we may experience and successfully realize the benefits of our previous acquisitions and any other acquisitions and collaborative arrangements we may pursue; competition from pharmaceutical companies, outsourcing facilities and pharmacies; general economic and business conditions, including inflation and supply chain challenges; regulatory and legal risks and uncertainties related to our pharmacy operations and the pharmacy and pharmaceutical business in general, including the ongoing communications with the U.S. Food and Drug Administration relating to compliance and quality plans at our outsourcing facility in New Jersey; physician interest in and market acceptance of our current and any future formulations and compounding pharmacies generally. These and additional risks and uncertainties are more fully described in Harrow’s filings with the Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2023, subsequent Quarterly Reports on Form 10-Q, and other filings with the SEC. Such documents may be read free of charge on the SEC's web site at sec.gov. Undue reliance should not be placed on forward‑looking statements, which speak only as of the date they are made. Except as required by law, Harrow undertakes no obligation to update any forward-looking statements to reflect new information, events, or circumstances after the date they are made, or to reflect the occurrence of unanticipated events. HARROW, INC. CONDENSED CONSOLIDATED BALANCE SHEETS December 31, 2024 December 31, 2023 (unaudited) ASSETS Cash and cash equivalents $ 47,247,000 $ 74,085,000 All other current assets 142,404,000 65,397,000 Total current assets 189,651,000 139,482,000 All other assets 199,320,000 172,682,000 TOTAL ASSETS $ 388,971,000 $ 312,164,000 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities $ 91,343,000 $ 49,344,000 Loans payable, net of unamortized debt discount 219,539,000 185,885,000 All other liabilities 8,792,000 6,524,000 TOTAL LIABILITIES 319,674,000 241,753,000 TOTAL STOCKHOLDERS' EQUITY 69,297,000 70,411,000 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 388,971,000 $ 312,164,000 HARROW, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS For the Three Months Ended December 31, For the Year Ended December 31, 2024 2023 2024 2023 Total revenues $ 66,831,000 $ 36,355,000 $ 199,614,000 $ 130,193,000 Cost of sales 14,135,000 11,302,000 49,245,000 39,640,000 Gross profit 52,696,000 25,053,000 150,369,000 90,553,000 Selling, general and administrative 34,789,000 26,212,000 129,064,000 83,090,000 Research and development 4,755,000 3,336,000 12,230,000 6,652,000 Impairment of long-lived assets 253,000 380,000 253,000 380,000 Total operating expenses 39,797,000 29,928,000 141,547,000 90,122,000 Income (loss) from operations 12,899,000 (4,875,000 ) 8,822,000 431,000 Total other expense, net (6,636,000 ) (4,808,000 ) (26,142,000 ) (24,141,000 ) Income tax benefit (expense) 514,000 535,000 (161,000 ) (701,000 ) Net income (loss) attributable to Harrow, Inc. $ 6,777,000 $ (9,148,000 ) $ (17,481,000 ) $ (24,411,000 ) Net income (loss) per share: Basic $ 0.19 $ (0.26 ) $ (0.49 ) $ (0.75 ) Diluted $ 0.24 $ (0.26 ) $ (0.49 ) $ (0.75 ) HARROW, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2024 2023 Net cash (used in) provided by: Operating activities $ (22,202,000 ) $ 3,840,000 Investing activities (33,164,000 ) (152,553,000 ) Financing activities 28,528,000 126,528,000 Net change in cash and cash equivalents (26,838,000 ) (22,185,000 ) Cash and cash equivalents at beginning of the period 74,085,000 96,270,000 Cash and cash equivalents at end of the period $ 47,247,000 $ 74,085,000 Non-GAAP Financial Measures In addition to the Company’s results of operations determined in accordance with U.S. generally accepted accounting principles (GAAP), which are presented and discussed above, management also utilizes Adjusted EBITDA and Core Results, unaudited financial measures that are not calculated in accordance with GAAP, to evaluate the Company’s financial results and performance and to plan and forecast future periods. Adjusted EBITDA and Core Results are considered “non‑GAAP” financial measures within the meaning of Regulation G promulgated by the SEC. Management believes that these non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results, provide a more complete understanding of the Company’s results of operations and the factors and trends affecting its business. Management believes Adjusted EBITDA and Core Results provide meaningful supplemental information regarding the Company’s performance because (i) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making; (ii) they exclude the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company’s core operating performance and that may obscure trends in the Company’s core operating performance; and (iii) they are used by institutional investors and the analyst community to help analyze the Company’s results. However, Adjusted EBITDA, Core Results, and any other non‑GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further, non‑GAAP financial measures used by the Company and the way they are calculated may differ from the non-GAAP financial measures or the calculations of the same non‑GAAP financial measures used by other companies, including the Company’s competitors. Adjusted EBITDA The Company defines Adjusted EBITDA as net income (loss), excluding the effects of stock‑based compensation and expenses, impairment of intangible assets, interest, taxes, depreciation, amortization, investment (income) loss, net, and, if any and when specified, other non-recurring income or expense items. Management believes that the most directly comparable GAAP financial measure to Adjusted EBITDA is net income (loss). Adjusted EBITDA has limitations and should not be considered as an alternative to gross profit or net loss as a measure of operating performance or to net cash provided by (used in) operating, investing, or financing activities as a measure of ability to meet cash needs. The following is a reconciliation of Adjusted EBITDA, a non-GAAP measure, to the most comparable GAAP measure, net income (loss), for the three months and year ended December 31, 2024 and for the same periods in 2023: HARROW, INC. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA For the Three Months Ended December 31, For the Year Ended December 31, 2024 2023 2024 2023 GAAP net income (loss) $ 6,777,000 $ (9,148,000 ) $ (17,481,000 ) $ (24,411,000 ) Stock-based compensation and expenses 4,794,000 4,175,000 17,619,000 15,696,000 Impairment of intangible assets 253,000 380,000 253,000 380,000 Interest expense, net 6,375,000 5,124,000 22,786,000 21,324,000 Income tax (benefit) expense (514,000 ) (535,000 ) 161,000 701,000 Depreciation 468,000 435,000 1,850,000 1,530,000 Amortization of intangible assets 4,075,000 2,448,000 11,783,000 10,082,000 Investment (income) loss, net - (416,000 ) 3,171,000 (3,092,000 ) Loss on disposal of equipment - 146,000 - 168,000 Other expense (income), net 261,000 (46,000 ) 185,000 5,741,000 (1) Adjusted EBITDA $ 22,489,000 $ 2,563,000 $ 40,327,000 $ 28,119,000 (1) Includes $5,465,000 for the loss on extinguishment of debt. Core Results Harrow Core Results, including core gross margin, core net income (loss), and core basic and diluted income (loss) per share exclude (1) all amortization and impairment charges of intangible assets, excluding software development costs, (2) net gains and losses on investments and equity securities, including equity method gains and losses and equity valued at fair value through profit and loss (FVPL), and preferred stock dividends, and (3) gains/losses on forgiveness of debt. In certain periods, Core Results may also exclude fair value adjustments of financial assets in the form of options to acquire a company carried at FVPL, obligations related to product recalls, certain acquisition‑related items, restructuring charges/releases and associated items, related legal items, gains/losses on early extinguishment of debt or debt modifications, impairments of property, plant and equipment and software, as well as income and expense items that management deems exceptional and that are or are expected to accumulate within the year to be over a $100,000 threshold. The following is a reconciliation of Core Results, non-GAAP measures, to the most comparable GAAP measures for the three months and year ended December 31, 2024 and for the same periods in 2023: For the Three Months Ended December 31, 2024 GAAP Results Amortization of Certain Intangible Assets Impairments Investment Gains (Losses) Other Items Core Results Gross profit $ 52,696,000 $ 3,622,000 $ - $ - $ - $ 56,318,000 Gross margin 79 % 84 % Operating income 12,899,000 4,075,000 253,000 - - 17,227,000 Income before taxes 6,263,000 4,075,000 253,000 - 261,000 10,852,000 Taxes 514,000 - - - - 514,000 Net income 6,777,000 4,075,000 253,000 - 261,000 11,366,000 Income per share ($)(1): Basic 0.19 0.32 Diluted 0.24 0.40 Weighted average number of shares of common stock outstanding: Basic 35,807,767 35,807,767 Diluted 28,317,740 28,317,740 For the Year Ended December 31, 2024 GAAP Results Amortization of Certain Intangible Assets Impairments Investment Gains (Losses) Other Items Core Results Gross profit $ 150,369,000 $ 10,093,000 $ - $ - $ - $ 160,462,000 Gross margin 75 % 80 % Operating income 8,822,000 11,783,000 253,000 - - 20,858,000 (Loss) income before taxes (17,320,000 ) 11,783,000 253,000 3,171,000 185,000 (1,928,000 ) Tax expense (161,000 ) - - - - (161,000 ) Net (loss) income (17,481,000 ) 11,783,000 253,000 3,171,000 185,000 (2,089,000 ) Basic and diluted loss per share ($)(1) (0.49 ) (0.06 ) Weighted average number of shares of common stock outstanding, basic and diluted 35,650,714 35,650,714 For the Three Months Ended December 31, 2023 GAAP Results Amortization of Certain Intangible Assets Impairments Investment Gains (Losses) Other Items Core Results Gross profit $ 25,053,000 $ 2,140,000 $ - $ - $ - $ 27,193,000 Gross margin 69 % 75 % Operating (loss) income (4,875,000 ) 2,448,000 - - - (2,427,000 ) (Loss) income before taxes (9,683,000 ) 2,448,000 - (416,000 ) 100,000 (7,551,000 ) Tax benefit 535,000 - - - - 535,000 Net (loss) income (9,148,000 ) 2,448,000 - (416,000 ) 100,000 (7,016,000 ) Basic and diluted loss per share ($)(1) (0.26 ) (0.20 ) Weighted average number of shares of common stock outstanding, basic and diluted 35,353,848 35,353,848 For the Year Ended December 31, 2023 GAAP Results Amortization of Certain Intangible Assets Impairments Investment Gains (Losses) Other Items Core Results Gross profit $ 90,553,000 $ 9,314,000 $ - $ - $ - $ 99,867,000 Gross margin 70 % 77 % Operating income 431,000 10,082,000 - - - 10,513,000 (Loss) income before taxes (23,710,000 ) 10,082,000 - (3,092,000 ) 5,909,000 (10,811,000 ) Tax expense (701,000 ) - - - - (701,000 ) Net (loss) income (24,411,000 ) 10,082,000 - (3,092,000 ) 5,909,000 (11,512,000 ) Basic and diluted loss per share ($)(1) (0.75 ) (0.35 ) Weighted average number of shares of common stock outstanding, basic and diluted 32,616,777 32,616,777 (1) Core basic and diluted income (loss) per share is calculated using the weighted-average number of shares of common stock outstanding during the period. Core basic and diluted income (loss) per share also contemplates dilutive shares associated with equity‑based awards as described in Note 2 and elsewhere in the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.