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PCRX, Pacira BioSciences

Pharmaceuticals consumer brand Distress / turnaroundCyclical

Pacira BioSciences, Inc. is the holding company for our California operating subsidiary named Pacira Pharmaceuticals, Inc.

EXPAREL—our flagship product—is a long-acting, local analgesic currently approved for postsurgical pain management.

PCRX-201 is the lead program from our proprietary high-capacity adenovirus, or HCAd, vector platform, which enables local administration of genetic medicines and has the potential to unlock gene therapy for large prevalent diseases affecting millions of people.

Latest annual: FY2025 10-K

PCRX · Pacira BioSciences

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$726M

+3.6% YoY · 11% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $735M 5-yr avg $662M

Gross margin 79% 5-yr avg 74%

Operating margin 3.3% 5-yr avg 6.2%

ROIC 1% 5-yr avg 4%

Owner-earnings margin 18% 5-yr avg 20%

Free cash flow margin 18% 5-yr avg 19%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is EXPAREL (79%), ZILRETTA (16%) and iovera° (3%).
Situation: Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock. Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Gross margin has run about 73% and operating margin about 2.6% through the cycle, a wide spread between price and the cost of what it sells — whether that advantage is durable pricing power or a margin that can erode is the question the record is for. The margin is cyclical, swinging between −12% and 17% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. Inventory runs near 15% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on the pipeline against the patent cliff, and pricing. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median 2%, above 15% in 0 of 8 years). By owner earnings: roughly 16% of revenue reaches owners as cash, consistently. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

EXPAREL is 79% of revenue, with ZILRETTA the other meaningful line at 16%.

Revenue by product line, FY2025

EXPAREL79%$575M
ZILRETTA16%$117M
iovera°3%$24M
Bupivacaine liposome injectable suspension1%$7M
Royalty0%$4M

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$270M	$284M	$332M	$419M	$430M	$542M	$667M	$675M	$701M	$726M	$735M	RevenueRevenue
59%	69%	74%	75%	73%	74%	70%	73%	76%	79%	79%	Gross marginGross mgn
57%	57%	53%	48%	45%	37%	38%	40%	42%	51%	51%	SG&A / revenueSG&A/rev
17%	20%	17%	17%	14%	10%	13%	11%	12%	16%	16%	R&D / revenueR&D/rev
($32M)	($25M)	$16M	$10M	$46M	$90M	$60M	$88M	($73M)	$19M	$24M	Operating incomeOp. inc.
−11.9%	−8.8%	4.8%	2.5%	10.8%	16.6%	9.0%	13.0%	−10.5%	2.6%	3.3%	Operating marginOp. mgn
($38M)	($43M)	($471K)	($11M)	$146M	$42M	$16M	$42M	($100M)	$7M	$5M	Net incomeNet inc.
—	—	—	—	—	26%	—	32%	—	58%	—	Effective tax rateTax rate
											Cash flow & returns
$33M	$18M	$49M	$71M	$77M	$126M	$145M	$155M	$189M	$152M	$142M	Operating cash flowOp. cash
$13M	$14M	$13M	$20M	$20M	$29M	$92M	$76M	$79M	$91M	$91M	DepreciationDeprec.
$27M	$15M	$4M	$28M	($128M)	$13M	($10M)	($11M)	$159M	($4M)	($11M)	Working capital & otherWC & other
$25M	$19M	$15M	$10M	$38M	$46M	$30M	$15M	$11M	$15M	$10M	CapexCapex
9.1%	6.8%	4.4%	2.4%	8.8%	8.5%	4.5%	2.2%	1.5%	2.1%	1.3%	Capex / revenueCapex/rev
$21M	$4M	$34M	$60M	$57M	$97M	$115M	$139M	$179M	$137M	$133M	Owner earningsOwner earn.
7.6%	1.4%	10.3%	14.4%	13.3%	17.9%	17.3%	20.7%	25.5%	18.8%	18.1%	Owner earnings marginOE mgn
$9M	($1M)	$34M	$60M	$39M	$80M	$115M	$139M	$179M	$137M	$133M	Free cash flowFCF
3.2%	−0.5%	10.3%	14.4%	9.1%	14.7%	17.3%	20.7%	25.5%	18.8%	18.1%	Free cash flow marginFCF mgn
$0	$0	$0	$118M	$0	$420M	$0	$0	$0	$17M	$335K	AcquisitionsAcquis.
—	—	—	—	—	—	$0	$0	$25M	$148M	—	BuybacksBuybacks
-6%	-4%	3%	—	6%	14%	—	5%	-5%	1%	1%	ROICROIC
-17%	-15%	-0%	-3%	23%	6%	2%	5%	-13%	1%	1%	Return on equityROE
−17%	−15%	−0%	−3%	23%	6%	2%	5%	−13%	1%	1%	Retained to equityRetained/eq
											Balance sheet
$173M	$311M	$383M	$292M	$522M	$656M	$289M	$279M	$485M	$238M	$202M	Cash & investmentsCash+inv
$30M	$32M	$38M	$48M	$53M	$96M	$98M	$106M	$113M	$124M	$126M	ReceivablesReceiv.
$31M	$41M	$49M	$58M	$65M	$99M	$96M	$104M	$125M	$153M	$150M	InventoryInvent.
$8M	$15M	$14M	$13M	$10M	$11M	$15M	$16M	$19M	$15M	$14M	Accounts payablePayables
$54M	$58M	$72M	$93M	$107M	$184M	$179M	$194M	$219M	$262M	$262M	Operating working capitalOper. WC
$243M	$391M	$478M	$409M	$652M	$866M	$498M	$510M	$745M	$548M	$515M	Current assetsCur. assets
$45M	$56M	$61M	$108M	$253M	$521M	$148M	$97M	$310M	$121M	$109M	Current liabilitiesCur. liab.
5.4×	7.0×	7.9×	3.8×	2.6×	1.7×	3.4×	5.2×	2.4×	4.5×	4.7×	Current ratioCurr. ratio
$47M	$55M	$62M	$100M	$100M	$145M	$163M	$163M	$0	$20M	$20M	GoodwillGoodwill
$391M	$628M	$689M	$831M	$1.3B	$2.1B	$1.7B	$1.6B	$1.6B	$1.3B	$1.2B	Total assetsAssets
$227M	$276M	$291M	$306M	$313M	$339M	$689M	$522M	$585M	$372M	$368M	Total debtDebt
$55M	($35M)	($93M)	$14M	($209M)	($317M)	$401M	$244M	$101M	$134M	$165M	Net debt / (cash)Net debt
-4.5×	-1.4×	0.7×	0.4×	1.8×	2.8×	1.5×	4.3×	-4.4×	1.1×	1.5×	Interest coverageInt. cov.
$219M	$279M	$321M	$355M	$620M	$730M	$775M	$870M	$778M	$693M	$654M	Shareholders’ equityEquity
11.6%	11.1%	9.5%	8.0%	9.3%	7.8%	7.2%	7.1%	7.3%	7.9%	7.7%	Stock comp / revenueSBC/rev
											Per share
37.2M	39.8M	40.9M	41.5M	43.7M	45.6M	46.5M	52.0M	46.2M	45.0M	40.9M	Shares out (diluted)Shares
$7.25	$7.14	$8.13	$10.09	$9.84	$11.87	$14.33	$12.99	$15.16	$16.13	$17.96	Revenue / shareRev/sh
$-1.02	$-1.07	$-0.01	$-0.27	$3.33	$0.92	$0.34	$0.81	$-2.15	$0.16	$0.13	EPS (diluted)EPS
$0.55	$0.10	$0.84	$1.45	$1.31	$2.13	$2.48	$2.68	$3.87	$3.03	$3.24	Owner earnings / shareOE/sh
$0.23	$-0.04	$0.84	$1.45	$0.90	$1.75	$2.48	$2.68	$3.87	$3.03	$3.24	Free cash flow / shareFCF/sh
$0.66	$0.48	$0.35	$0.24	$0.87	$1.01	$0.65	$0.29	$0.23	$0.34	$0.23	Cap. spending / shareCapex/sh
$5.88	$7.02	$7.85	$8.55	$14.19	$16.01	$16.65	$16.74	$16.83	$15.39	$15.98	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+9.3%/yr	+10.4%/yr
Owner earnings / share	+20.9%/yr	+18.3%/yr
EPS	—	−45.8%/yr
Capital spending / share	−7.1%/yr	−17.0%/yr
Book value / share	+11.3%/yr	+1.6%/yr

The year, in the company's words

the filing →

Verbatim from the 10-K's management discussion. Each sentence is shown only because its subject, direction, and stated figures check out against the filed numbers on this page. The words are the company's; the arithmetic is the record's.

ZILRETTA-1.2%
“ZILRETTA revenue decreased 1% in 2025 versus 2024, primarily due to a 4% decrease in kit volume, partially offset by a 3% increase in net selling price per unit.”
✓ figure matches the filed record
Bupivacaine liposome injectable suspension-5.6%
“Bupivacaine liposome injectable suspension revenue and its related royalties both decreased 6% in 2025 versus 2024, primarily due to the sales mix of vial sizes and the timing of orders placed by our partner for veterinary use.”
✓ figure matches the filed record

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

45Mpeak FY2023

ROIC

1%low FY2016

Gross margin

79%low FY2016

Net debt ÷ owner earnings

1.0×peak FY2022

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$137Mowner earningsvs.$7Mnet incomelow FY2017

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned $7M of profit into $137M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

Reported net income$7M

Owner earnings$137M · 19% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$7M	($100M)	$42M	$16M	$42M
Depreciation & amortizationnon-cash charge added back	+$91M	+$79M	+$76M	+$92M	+$29M
Stock-based compensationreal costnon-cash, but a real cost	+$58M	+$51M	+$48M	+$48M	+$42M
Working capital & othertiming of cash in and out, other non-cash items	−$4M	+$159M	−$11M	−$10M	+$13M
Cash from operations	$152M	$189M	$155M	$145M	$126M
Maintenance capital expenditurethe spending needed just to hold position and volume	−$15M	−$11M	−$15M	−$30M	−$29M
Owner earnings	$137M	$179M	$139M	$115M	$97M
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	—	—	—	—	−$17M
Free cash flow	$137M	$179M	$139M	$115M	$80M
Owner-earnings marginowner earnings ÷ revenue	19%	26%	21%	17%	18%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $58M), owner earnings is nearer $79M.

Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 1.1×

Thin

Operating income $19M ÷ interest expense $17M

What this means
Operating profit covers interest, but with little room. A bad year, a refinancing at higher rates, or a revenue wobble closes the gap fast.
How heavy is the debt, net of cash? $134M · 7.0× operating profit

Heavy net debt

Cash $159M + ST investments $80M − debt $372M

What this means
Netting $238M of cash and short-term investments against $372M of debt leaves $134M owed, about 7.0× a year's operating profit (19.4× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 398d

Long (60+ days)

DSO 62 + DIO 373 − DPO 37 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 1%

Below average through the cycle

8-yr median, range -6%–14%; 1% latest = NOPAT $10M ÷ invested capital $907M

Industry peers: median 9%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 8 years (it ran 1% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 14%

Solid through the cycle

10-yr median margin, range 1%–26%; latest $137M = operating cash $152M − maintenance capex $15M

Industry peers: median 15%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 19% of revenue this year, a 14% median across 10 years. Treating stock comp as the real expense it is (less $58M of SBC) leaves $79M.
Are earnings backed by cash? 21.61×

Cash-backed

Cash from ops $152M ÷ net income $7M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 109%

Returned more than it generated

Dividends + buybacks $148M ÷ Owner Earnings $137M

What this means
The company returned more than it generated: against $137M of Owner Earnings, $148M (109%) went back to shareholders, $0 dividends, $148M buybacks — the excess came from the balance sheet or borrowing, not the year's operations. Net of $58M stock comp, the real buyback was about $91M. Sustained, that pattern draws down cash or adds debt; the net-debt line above shows where it stands.
Investing or harvesting? 0.17×

Harvesting

Capex $15M ÷ depreciation $91M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $726M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 4.54×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $372M vs $427M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 5 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-0.43/share (latest year $0.18), the averaged base the calculator's gate runs on, and book value is $17.61/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 5 of 10

What this means
Lost money in 5 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin −5% → 2% (3-yr avg ends)

In the filing’s words The record and the words agree: the margin widened and the filing attributes the gain to its own pricing, not volume alone.

What this means
Through the cycle the operating margin widened — about −5% early to 2% lately, median 3% — pricing power intact or improving.
Reinvestment, incremental ROIC 2%

What this means
Reinvested capital came back at only a modest incremental return — near the cost of capital, where extra growth adds little per dollar. The record shows whether it is a soft stretch or a thinning moat.
Owner earnings growth +33%/yr

What this means
Owner earnings grew about 33% a year over the record.
Worst year 2016 · −11.9% op. margin

What this means
Operations went underwater in 2016, understand why before trusting the good years.
Share count +2.1%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“Our use of AI could result in additional compliance costs, regulatory investigations, actions and lawsuits; and if as a result, we are unable to properly or effectively use AI, it could make our business less efficient, potentially result in competitive disadvantages, and our business, financial condition, results of o…”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$515M

Cash & short-term investments$202M
Receivables$126M
Inventory$150M
Other current assets$37M

Current liabilities$109M

Accounts payable$14M
Other current liabilities$95M

Current ratio4.73×all current assets ÷ what's due · Graham looked for 2×

Quick ratio3.35×stricter: inventory excluded

Cash ratio1.86×strictest: cash alone against what's due

Working capital$406Mthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+5.0%the freshest read on whether the business is still growing

Current ratio, recent quarters6.8× → 4.7×

Deeper floors

Tangible book value$281Mequity stripped of goodwill & intangibles

Net current asset value($40M)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$411M$44M of it operating leases

Deferred revenue$10Mcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $1.0B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.

Reinvested$224M · 22%
Buybacks$173M · 17%
Retained (debt / cash)$618M · 61%

Returned to owners$173M
21% of the owner earnings the business produced over the span, $0 as dividends and $173M as buybacks.
Average price paid for buybacks$24.98
Across the years where the filing reports a share count, 6M shares were bought for $148M, about $24.98 each.
Net change in share count9.9%
The diluted count rose from 37M to 41M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$388M31% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity3%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$554Mover 10 years buying other businesses, against $224M of capital spent building

$163M written down across 1 year (2024): goodwill the company has already conceded it overpaid for, charged against earnings. That is roughly 29% of the cash it put into acquisitions over the span. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Pay, as filed	“Actually paid”	Owner earnings
2020	$9.3M	$13.6M	$57M
2021	$6.9M	$5.5M	$97M
2022	$6.9M	$887k	$115M
2023	$6.9M	$4.2M	$139M
2024	$15.9M	$10.2M	$179M
2024	$727k	−$2.7M	$179M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership6.4%
The stake all directors and executive officers hold together, per the 2025 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio68:1
What the chief earns for every dollar the median employee makes, per the 2025 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$58M
The slice of the business handed to employees in shares this year, 8% of revenue, equal to 300% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Pacira BioSciences is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

2 of the 6 tests turned up something to look into; the other 4 came back clean.

Look hereDid the share count rise anyway?9.9%
Diluted shares grew 9.9% over 2016–2025, even as the company spent $173M on buybacks. The repurchases were a treadmill: stock issued to staff outran them, so owners' slice still shrank. Read the buyback line beside this one, not on its own.
Look hereDid receivables and inventory outpace sales?23% → 38% of sales
Receivables and inventory grew from $61M to $276M while revenue grew 172%: working capital is climbing faster than sales (23% of revenue then, 38% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

And these came back clean

Is it less profitable than it was?
Did debt outgrow the business?
Did reported profit become cash?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Acquisitions, Stock compensation as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Pharmaceuticals

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
COLLCollegium Pharmaceutical Inc.	$781M	56%	6.8%	44%	31%
CORTCorcept Therapeutics Incorporated	$761M	98%	30.6%	25%	34%
EBSEmergent BioSolutions Inc.	$743M	58%	12.5%	6%	8%
PCRXPacira BioSciences	$726M	73%	3.7%	2%	16%
AMPHAmphastar Pharmaceuticals Inc.	$720M	43%	11.0%	9%	15%
SUPNSupernus Pharmaceuticals Inc.	$719M	90%	20.0%	11%	26%
KNSAKiniksa Pharmaceuticals International, PLC	$678M	88%	-9.3%	-6%	5%
RAREUltragenyx	$673M	100%	-154.9%	-92%	-113%
Group median	—	80%	8.9%	7%	15%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Pacira BioSciences has delivered.

Pacira BioSciences’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Pacira BioSciences earns about $115M on its 15.8% median owner-earnings margin. This year’s 18.8% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($115M) Net of stock comp (−$56M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+10%/yr

Owner-earnings growth · ’16→’25+52%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $133M on 39M shares outstanding, per the 10-Q cover, as of 2026-04-29; net debt $165M. The if-converted diluted count is 41M, 4% above the shares outstanding: the dilution overhang (convertibles, options) a buyer inherits. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh PCRX against another business →

The owners of PCRX: the meeting and the votes →

Cite: Owner Scorecard, "Pacira BioSciences (PCRX), the owner's record," https://ownerscorecard.com/c/PCRX, data as of 2026-07-09.

Manual order: ← PCOR its page in the Manual PCT →

Industry order: ← PBYI the Pharmaceuticals chapter PFE →