Acquisitions

3 Months Ended

Mar. 31, 2026

Business Combinations [Abstract]

Acquisitions

3. Acquisitions

The Company’s growth strategy involves periodically acquiring institutional pharmacies servicing LTCFs and their residents as well as residents in other care settings. The Company’s strategy includes the acquisition of freestanding institutional pharmacy businesses as well as other assets, generally less significant in size, which are combined with existing pharmacy operations to augment internal organic growth.

2025 Acquisitions

In 2025, the Company completed acquisitions of various pharmacy operations (the “2025 Acquisitions”). Total consideration for the 2025 Acquisitions included $13,725 of cash, $125 of deferred inventory payments, 24,075 shares of Class B common stock with a fair value of $441, and contingent earnout payments of up to $2,600 if certain revenue and earnings targets are achieved by certain acquired entities during the first full four quarters subsequent to the acquisition date. The fair value of the shares of Class B common stock issued was determined based on the closing share price of the Company’s Class A common stock on the acquisition date, discounted for a lack of registration, as the Class B common stock remains unregistered. The fair value of the contingent consideration arrangements at the acquisition dates, at December 31, 2025, and at March 31, 2026 was $2,600. The total purchase consideration for the 2025 Acquisitions was $16,891.

The 2025 Acquisitions included non-controlling interests, for which the fair value was estimated to be $3,609. The fair value of the non-controlling interests was estimated by utilizing the implied fair value of the non-controlling interest, determined based on the acquisition purchase price, and considering discounts necessary due to the lack of marketability and lack of control associated with the non-controlling interest. We incurred an immaterial amount of acquisition costs in connection with the 2025 Acquisitions.

The 2025 Acquisitions were treated as purchases in accordance with ASC 805, Business Combinations, which requires recognition of the estimated fair values of assets acquired and liabilities assumed in a transaction. Our recognition of the assets acquired and liabilities assumed was based on management’s judgment after evaluating several factors, including a valuation assessment. There were no material measurement period adjustments recognized in periods subsequent to the 2025 Acquisitions.

The recognition of the assets and liabilities of the 2025 Acquisitions as of December 31, 2025 is as follows:

(in thousands)	Fair Value
Total purchase consideration	$	16,891
Net assets acquired:
Inventory		1,891
Other assets		4,362
Intangible Assets		6,876
Other liabilities		(3,076	)
Non-controlling interest equity		(3,609	)
Net assets acquired		6,444
Goodwill	$	10,447

Goodwill and Intangible Assets

Goodwill represents the excess of the purchase price over the estimated fair value of the identifiable net assets acquired in the 2025 Acquisitions. Goodwill represents future economic benefits expected to arise from the Company’s expanded presence in the long-term care pharmacy industry, the assembled workforce acquired, and expected revenue synergies, as well as operating efficiencies and cost savings. Of the $10,447 of goodwill recorded related to the 2025 Acquisitions, $8,136 is expected to be deductible for tax purposes.

Intangible assets are comprised of customer lists and trademarks. The fair values for the customer lists and trademarks were $6,586 and $290, respectively. The weighted average useful lives for the customer lists and trademarks were 10 years and 5 years, respectively.

Consolidated Results of Operations

The results of operations for the 2025 Acquisitions have been included in the consolidated financial statements since the dates of acquisition.

The comparable prior period results of operations associated with the 2025 Acquisitions are not material to the consolidated financial statements, and as such, supplemental pro forma financial information is not presented.