Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 621

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 2
Chunk 621
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incident that involved unauthorized access of an employee’s email account. Through this unauthorized access the threat actor was
able to fraudulently divert Company funds to its bank account. The Company, along with its external cybersecurity experts, fully investigated
and assessed the impact of the incident and notified, and is cooperated with, federal law enforcement. The Company detected the incident
in a time that management believes minimized any financial, operational or reputational risk to the Company. During the year ended December
31, 2024, the Company recorded a loss of $271,000 associated with this event and management does not believe any additional loss will
be recorded. At no point was the Company’s ability to generate revenues disrupted.

NOTE 19. SEGMENTS
AND CONCENTRATIONS

In 2023, the Company operated its business on the
basis of a single reportable segment due to the lack of discrete, precise financial information available to the chief operating decision
maker (“CODM”). The CODM is the Chief Executive Officer. The CODM does not review segment assets when assessing segment performance
and deciding how to allocate resources. During 2024, refinements were made to the financial reporting information and the Company began
reporting on two reportable segments which were generally determined based on the decision-making structure of the Company and the grouping
of similar products and services: Branded and ImprimisRx.

    ●
    The Branded segment includes activities of the Company’s
    FDA approved ophthalmology pharmaceutical products, including the out-licensing of rights to certain of our branded products.

    ●
    The ImprimisRx segment represents activities in the Company’s
    ophthalmology-focused pharmaceutical compounding business.

    F-44

Segment contribution for the segments represents
net revenues less cost of sales, certain general and administrative expenses, selling and marketing expenses, and research and development
expenses. The Company does not evaluate the following items at the segment level:

    ●
    Selling, general and administrative expenses that result from shared
    infrastructure, including certain expenses associated with legal matters, public company costs (e.g. investor relations), Board of
    Directors and principal executive officers and other like shared expenses.

    ●
    Operating expenses within selling, general and administrative expenses
    that result from the impact of corporate initiatives. Corporate initiatives primarily include integration, restructuring, acquisition
    and other shared costs.

    ●
    Other select revenues and operating expenses including research and
    development expenses, amort