Washington, D.C. 20549


(Mark One)


For the fiscal year ended December 31, 2019



For the transition period from _____  to _____

Commission File Number: 001-38599

Aquestive Therapeutics, Inc.
(Exact Name of Registrant as Specified in its Charter)

(State or Other Jurisdiction of Incorporation or Organization)
(I.R.S. Employer Identification Number)

30 Technology Drive, Warren, NJ
(Address of Principal Executive Offices)
(Zip Code)

(908) 941-1900
(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.001 per share
NASDAQ Global Market

Securities registered pursuant to Section 12(g) of the Act:       None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  ☐ Yes  ☒ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  ☐ Yes  ☒ No

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes  ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes  ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Securities Exchange Act of 1934.

Large accelerated filer  ☐
Accelerated filer ☐
Non-accelerated filer ☒
Smaller reporting company ☒
Emerging growth company  ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  ☐ Yes  ☒ No

As of June 30, 2019, the last day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the common stock held by non-affiliates of the registrant was approximately $101.0 million based on the closing price of the registrant’s common stock on such date.

The number of outstanding shares of the registrant’s par value $0.001 common stock as of the close of business on March 6, 2020 was 33,582,234.

The registrant intends to file a definitive proxy statement pursuant to Regulation 14A in connection with its 2020 Annual Meeting of Shareholders within 120 days of the end of its fiscal year ended December 31, 2019.  Portions of such definitive proxy statement are incorporated by reference into Part III of this Annual Report on Form 10-K.

Table of Contents

Page No.
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Item 15.


Forward-Looking Statements

This Annual Report on Form 10-K and certain other communications made by us include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Words such as “believe,” “anticipate,” “plan,” “expect,” “estimate”, “intend,” “may,” “will,” or the negative of those terms, and similar expressions, are intended to identify forward-looking statements. These forward-looking statements may include, but are not limited to, statements regarding therapeutic benefits and plans and objectives for regulatory approvals of AQST-108, Libervant TM and our other product candidates; ability to obtain FDA approval and advance AQST-108, Libervant and our other product candidates to the market; statements about our growth and future financial and operating results and financial position, regulatory approval and pathways, clinical trial timing and plans, our and our competitors’ orphan drug approval and resulting drug exclusivity for our products or products our competitors; short-term and long-term liquidity and cash requirements, cash funding and cash burn, business strategies, market opportunities, and other statements that are not historical facts.

These forward statements are based on our current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.  Such risks and uncertainties include, but are not limited to, risks associated with the Company’s development work, including any delays or changes to the timing, cost and success of our product development activities and clinical trials and plans; risk of delays in FDA approval of  Libervant and our other drug candidates or failure to receive approval; risk of our ability to demonstrate to the FDA “clinical superiority” within the meaning of the FDA regulations of our drug candidate Libervant relative to FDA-approved diazepam rectal gel and nasal spray products  including by establishing a major contribution to patient care within the meaning of FDA regulations relative to the approved products and there can be no assurance that we will be successful; risk that a competitor obtains FDA orphan drug exclusivity for a product with the same active moiety as any of our other drug products for which we are seeking FDA approval and that such earlier approved competitor orphan drug blocks such other product candidates in the U.S. for seven years for the same indication; risk-inherent in commercializing a new product (including technology risks, financial risks, market risks and implementation risks and regulatory limitations); risk of development of our sales and marketing capabilities; risk of legal costs associated with and the outcome of our patent litigation challenging third party at risk generic sale of our proprietary products; risk of sufficient capital and cash resources, including access to available debt and equity financing and revenues from operations, to satisfy all of our short-term and longer-term cash requirements and other cash needs, at the time and in the amounts needed; risk of failure to satisfy all financial and other debt covenants and of any default; risk-related to government claims against Indivior for which we license, manufacture and sell Suboxone and which accounts for the substantial part of our current operating revenues; risk associated with Indivior’s cessation of production of its authorized generic buprenorphine naloxone film product, including the impact from loss of orders for the authorized generic product and risk of eroding market share for Suboxone® and risk of sunsetting product; risks related to coronavirus and potential impact on global businesses as well as on clinical trials, sourcing, regulatory approval and commercialization of our products and product candidates; risks related to the outsourcing of certain sales, marketing and other operational and staff functions to third parties; risk of the rate and degree of market acceptance of our product and product candidates; the success of any competing products, including generics; risk of the size and growth of our product markets; risks of compliance with all FDA and other governmental and customer requirements for our manufacturing facilities; risks associated with intellectual property rights and infringement claims relating to the Company’s products; risk of unexpected patent developments; the impact existing and future legislation and regulatory provisions on product exclusivity; legislation or regulatory actions affecting pharmaceutical product pricing, reimbursement or access; claims and risks that may arise regarding the safety or efficacy of the Company’s products and product candidates; risk of loss of significant customers; risks related to legal proceedings, including patent infringement, investigative and antitrust litigation matters; changes in government laws and regulations; risk of product recalls and withdrawals; uncertainties related to general economic, political, business, industry, regulatory and market conditions and other unusual items; and other risks and uncertainties affecting the Company including those described in the “Risk Factors” section and in other sections included in this Annual Report on Form10-K, in our Quarterly Reports on Form 10-Q, and in our Current Reports on Form 8-K filed with the Securities and Exchange Commission (SEC).  Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as the date made.  All subsequent forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by this cautionary statement. The Company assumes no obligation to update forward-looking statements, or outlook or guidance after the date of this Annual Report whether as a result of new information, future events or otherwise, except as may be required by applicable law.  Readers should not rely on the forward-looking statements included in this Annual Report as representing our views as of any date after the date of the filing of this Annual Report on Form 10-K.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these statements. These factors include the matters discussed and referenced in Part I-Item 1A. Risk Factors of this Form 10-K.

Item 1.


Aquestive Therapeutics, Inc., a Delaware corporation, was formed effective on January 1, 2018 via the conversion of MonoSol Rx, LLC, a Delaware limited liability company and predecessor or Aquestive Therapeutics, Inc., into a C corporation and a simultaneous name change to Aquestive Therapeutics, Inc. (referred to in this Annual Report on Form 10-K as the “January 2018 Conversion”). Unless the context otherwise indicates, references to “Aquestive”, “AQST”, “we”, the “Company”, “us” and “our” in this Annual Report on Form 10-K refers to Aquestive Therapeutics, Inc. Our principal executive offices are located in Warren, New Jersey.


We are a pharmaceutical company focused on developing and commercializing differentiated products to address unmet medical needs. We have proprietary products focused on the treatment of diseases of the Central Nervous System, or CNS, including one commercial-product, one commercial-stage product and a late-stage pipeline product candidate. We believe that the characteristics of these patient populations and shortcomings of available treatment options create opportunities for the development and commercialization of meaningfully differentiated medicines. In December 2018, we commercially launched the first of our CNS products, Sympazan® (clobazam) Oral Film, for use as an adjunctive therapy for seizures associated with Lennox-Gastaut Syndrome, or LGS, in patients two years and older. In November 2019, we received FDA approval of our product, Exservan®, which has been licensed for European marketing and for which we are seeking a licensee in the U.S.

Our most advanced proprietary product is Libervant™ (diazepam) Buccal Film.  Libervant is a buccally, or inside of the cheek, administered soluble film formulation of diazepam. Epilepsy patients have been underserved for some time with little choice beyond device-based products such as rectally administered gels and a recently approved diazepam nasal spray.  Aquestive is developing Libervant as an alternative to the current standard of care rescue therapy for patients with refractory epilepsy, which is a rectal gel, that is invasive, inconvenient, and difficult to administer.  As a result, a large portion of the patient population has not received adequate treatment or foregoes treatment altogether.  It is anticipated that Libervant, if approved by the U.S. Food and Drug Administration (FDA), will enable a larger share of these patients to receive more appropriate treatment by providing consistent therapeutic dosing in a non-invasive and innovative treatment form for epileptic seizures.  The Company filed an NDA for Libervant in November 2019.  The filing was accepted by the FDA in February 2020 and we have received a PDUFA goal date of September 27, 2020.  On January 10, 2020, a competitor of Aquestive obtained FDA approval of its diazepam nasal spray drug candidate and was granted orphan-drug-exclusivity for this drug commencing as of January 10, 2020.  A company that obtains FDA approval for a designated orphan drug receives market exclusivity for that drug for the designated indication for a period of seven years from the grant date in the United States.  This orphan drug exclusivity approval may prevent a subsequent product seeking FDA approval from being marketed in the United States during the exclusivity period for the same active moiety for the same orphan drug indication except in the case where the drug candidate sponsor is able to demonstrate, and the FDA concludes, that the later drug is “clinically superior” to the approved products, e.g., safer, more effective, or providing a major contribution to patient care within the meaning of FDA regulations and guidance.  In assessing whether a drug candidate sponsor has demonstrated that its drug candidate provides a “major contribution to patient care” over and above the currently approved drugs, which is evaluated by the FDA on a case by case basis, there is no one objective standard and the FDA may, in appropriate circumstances, consider such factors as convenience of treatment location, duration of treatment, patient comfort, reduced treatment burden, advances in ease and comfort of drug administration, longer periods between doses, and potential for self-administration.  We believe that our product candidate Libervant is “clinically superior” to the two currently FDA-approved products with the same moiety and for the same indication as Libervant, as qualifying as “a major contribution to patient care” within the meaning of the FDA regulation and guidance.  However, such a demonstration to overcome such seven-year market exclusivity is difficult to establish with limited precedents and there can be no assurance that we will be successful in these efforts.  Any failure to obtain FDA approval of and to demonstrate clinical superiority for Libervant would have a material adverse effect on our business, financial condition and results of operations in 2021 and later.  More details on this product approval are described in “Competition” section below in this Item 1. Business of this Form10-K.

We have developed a proprietary pipeline of complex molecule products addressing large market opportunities beyond CNS indications, including AQST-108, a sublingual film formulation of epinephrine for the treatment of anaphylaxis.  In February of 2020, we had a constructive face-to-face pre-Investigational New Drug (IND) application meeting with the FDA for this drug candidate.  A pre-IND meeting provides an opportunity for an open communication between a drug sponsor and the FDA to discuss the sponsor’s IND development plan and to obtain the agency’s guidance for clinical studies for the sponsor’s new drug candidate. The FDA has confirmed that the clinical development for AQST-108 will be reviewed under the 505(b)(2) pathway as proposed by Aquestive and that no additional studies would be necessary prior to opening the proposed IND application.  The FDA indicated that there appears to be an unmet medical need among patients who resist the standard of care use of intramuscular injection in the treatment of anaphylaxis and that AQST-108 may potentially address some of those unmet needs.  Aquestive expects to move forward with opening an IND and initiating its pharmacokinetic (PK) clinical trials before the end of 2020.

In addition to these products and product candidates, we have a portfolio of commercialized and development-stage drug products that we license to other companies. These products include Suboxone®, a sublingual film formulation of buprenorphine and naloxone, for the treatment of opioid dependence, and Exservan (riluzole), an oral film product for the treatment of amyotrophic lateral sclerosis (ALS).

We manufacture all of our licensed and proprietary products at our FDA and Drug Enforcement Agency, or DEA, inspected facilities and anticipate that our current manufacturing capacity is sufficient for commercial quantities of our products and product candidates currently in development. We have produced over 2.2 billion doses of Suboxone since 2010. Our products are developed using our proprietary PharmFilm® technology and know-how. Our patent portfolio currently comprises at least 200 issued patents worldwide, of which at least 40 are U.S. patents, and more than 90 pending patent applications worldwide.

Our Product Portfolio and Pipeline

The following table outlines our pipeline of products and product candidates