Elite Pharmaceuticals (OTCMKTS:ELTP) executives highlighted sharply higher revenue and profit during the company’s fiscal third quarter ended Dec. 31, 2025, citing expanding product offerings, stronger commercial execution, and increasing presence across both direct and wholesale distribution channels.
Quarterly results and year-to-date growth
Chief Financial Officer Carter Ward said total revenue for the quarter was $31.6 million, up from $14.4 million in the prior-year December quarter, representing a $17.2 million increase, or 120% year over year. Ward also pointed to continued momentum in the earlier quarters of the fiscal year, noting year-on-year revenue growth of 114% in Q1 and 92% in Q2.
Profitability, margins, and channel mix
Ward said gross profit was $13.0 million for the quarter and $54.0 million for the nine-month period, compared to $6.0 million and $23.0 million, respectively, in the prior year. That equated to gross profit increases of 112% for the quarter and 138% for the nine-month period, according to management.
Operating income rose to $9.0 million for the quarter and $39.0 million for the nine-month period, versus $1.0 million and $8.0 million in the prior-year periods. Ward described the quarter as reflecting improved margins compared with the September quarter, attributing the earlier margin compression to one-time wholesaler charges tied to stocking and related fees when launching products through indirect channels.
Management discussed the tradeoffs between direct sales and selling through wholesalers such as Cardinal, McKesson, and Cencora. Ward said direct sales can produce higher margins but require customers to have more complex supply chain capabilities. Indirect channels, he said, broaden market access and stability but include wholesaler costs that can reduce margins.
Cash flow, working capital, and balance sheet items
Ward reported operating cash flow of $14.6 million for the nine months ended Dec. 31, 2025, up from $3.5 million in the prior-year period.
He also said Elite’s working capital increased to $84 million at the end of the December quarter, up from $46 million at the start of the fiscal year. Ward traced the progression to $67 million after Q1 and $75 million after Q2, characterizing the balance sheet as “very strong” with low debt.
Responding to shareholder questions, Ward said Elite still has net operating loss carryforwards available. He pointed to a $10.3 million deferred tax asset on the balance sheet, down from $18.4 million at the start of the fiscal year, indicating the company has been using the NOLs but retains additional tax benefit.
Ward also addressed an increase in legal and professional expenses, tying the rise to broader compliance demands and Elite’s expanded footprint, including higher audit and legal fees, cybersecurity and IT infrastructure spending, Sarbanes-related requirements, multi-state tax filings, and complex CMS, Medicare, and Medicaid reporting supported by consultants.
On working capital dynamics, Ward said accounts receivable increased due to standard industry payment terms typically ranging from 60 to 90 days, adding that Elite has had “almost no problems collecting.” He also said finished goods inventory rose largely due to holiday shipping timing, with many end-of-December shipments not delivered until January (and therefore not recognized as revenue until delivery), alongside raw material receipts arriving late in the quarter.
Product performance and market commentary
Chairman and CEO Nasrat Hakim attributed Elite’s results to lean execution across departments and what he described as strong product selection. Hakim said Elite has about 65 employees and stated the company is “destined” to reach $130 million to $140 million in revenue by the end of the fiscal year.
Hakim identified Elite’s largest product as Lisdex, followed by amphetamine IR and amphetamine ER, stating these products have strong market share and profitability and are constrained by DEA quota and supply considerations, including API availability. He said if quota and supply constraints were fully aligned, the company “could sell twice as much.”
- Generic Lisdex: Hakim said it was launched about a year ago and that Elite has approximately 70% market share. He also described pricing pressure typical of generics, saying prices have declined from earlier in the year to about half, and he characterized current pricing as having reached a more stable point. He noted IQVIA market data may lag or omit certain volumes due to reporting delays and customer reporting practices.
- Amphetamine IR (generic Adderall): Hakim cited IQVIA data showing an average market share of about 16% from October through December, with steady pricing and profitability.
- Amphetamine ER (generic Adderall XR): He said the product is averaging about 14% market share with good margins.
- Naltrexone: Hakim said the product was launched in September under the Elite label and reached about 9% market share by the end of December, despite a market he described as dominated by Sun Pharma and Mallinckrodt.
- Isradipine and trimipramine: Hakim said each has only one competitor and that Elite holds 40% and 50% of sales, respectively, with healthy margins.
- Phentermine: He said Elite holds about 30% market share with good margins and is now selling the product exclusively under its own label.
Hakim also said Elite has conducted “soft launches” of generic oxycodone/acetaminophen, hydrocodone/acetaminophen, and acetaminophen with codeine, and that the company’s primary focus remains on the products he said generate the most profit—Lisdex and the two amphetamine products. He said Elite’s share in those newly launched pain products is currently about 2% to 4%, with an expectation that market share could rise over time.
Pipeline updates, litigation status, and strategic priorities
Management provided updates on several development and launch items:
- Ritalin: Hakim said Elite received approval and plans to launch in Q2 of 2026.
- Methadone: He said Elite plans to launch methadone in Q1 of 2026 and later reiterated it would be launched this quarter as a soft launch, with scaling dependent on market response and margins.
- OxyContin ER ANDA: Hakim said Elite has an ANDA under FDA review for a generic version of OxyContin ER as a Paragraph IV filing. He said the patent litigation is on stay and that the company is awaiting next steps by Purdue (now referred to as “Knoa”) or the courts. He said conditional approval is possible but uncertain.
- Undisclosed anticoagulant: Hakim said Elite previously announced a successful bioequivalence study and that the ANDA could be ready to file next month, though the company may choose to delay filing to further evaluate unexpired patents.
On business development, Hakim said mergers and acquisitions remain Elite’s primary focus and that the company is evaluating opportunities presented to it. If none are acceptable, he said Elite would pursue a Nasdaq uplisting or alternative actions. Hakim added that he would not consider a reverse split unless it were tied to a Nasdaq uplisting, citing concerns about stock manipulation on the OTC market.
Hakim also said Elite is represented on the VA Federal Supply Schedule and sells through distributors, but the company has opted not to sell amphetamine IR, amphetamine ER, or Lisdex through the FSS due to being fully utilizing its DEA quota in retail channels, which he described as more stable and higher value.
Elite said its next scheduled report will be its annual 10-K, due at the end of June.
About Elite Pharmaceuticals (OTCMKTS:ELTP)
Elite Pharmaceuticals, Inc is a U.S.-based specialty pharmaceutical company that acquires, develops and markets both branded and generic pharmaceutical products. Headquartered in Houston, Texas, the company focuses on complex dosage forms—including injectables, sterile formulations and oncology therapies—and seeks to address unmet medical needs through advanced drug delivery technologies. Its product portfolio spans therapeutic areas such as pain management, oncology and cardiovascular care.
Since its founding in 2007, Elite Pharmaceuticals has pursued strategic partnerships and licensing agreements to expand its pipeline and manufacturing capabilities.
