Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 1338

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 8
Chunk 1338
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 interests
in Surface Ophthalmics, Inc. (“Surface”) and Melt Pharmaceuticals, Inc. (“Melt”), both companies that began as
subsidiaries of Harrow. Harrow also owns royalty rights in various drug candidates being developed by Surface and Melt.

Effective September 29, 2023, the Company changed
its corporate name from Harrow Health, Inc. to Harrow, Inc. pursuant to a Certificate of Amendment to the Company’s Amended and
Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware.

NOTE 2. SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Harrow has prepared the accompanying consolidated
financial statements in accordance with accounting principles generally accepted in the U.S. (“GAAP”). The accompanying
consolidated financial statements include the accounts of the Company and its wholly owned and majority-owned subsidiaries.

Harrow consolidates entities in which it has a controlling
financial interest. The Company assesses control under the variable interest entity (“VIE”) model to determine whether the
Company is the primary beneficiary of that entity. The Company consolidates (i) entities in which it holds and/or controls, directly
or indirectly, more than 50% of the voting rights, and (ii) VIEs for which the Company is deemed to be the primary beneficiary. All intercompany
accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity
with GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the
reporting periods. Significant estimates made by management are, among others, allowance for credit losses, variable consideration determined
based on accruals for chargebacks, administrative fees and rebates, government rebates, returns and other allowances, renewal periods
and discount rates for leases, realizability of inventories, recoverability of investments, realizability of deferred tax assets, recoverability
of long-lived assets and goodwill, valuations and purchase price allocations related to business combinations and asset acquisitions,
fair value of loans payable, and valuation of stock-based transactions with employees and non-employees. Actual results could differ
from those estimates.

Risks
and Uncertainties

The Company is subject to certain regulatory
standards, approvals, guidelines and inspections which could impact the Company’s ability to make, dispense,