Here are 1-2 brief analogies to describe Simulations Plus (SLP):

• It's like Ansys, but for simulating how drugs behave in the human body and during development. (Ansys is well-known for its engineering simulation software; SLP provides specialized simulation tools for pharmaceutical and biotech R&D.)
• Think of it as MathWorks (MATLAB) for pharmaceutical R&D, focused on AI-powered predictive modeling. (MathWorks, known for MATLAB, provides powerful computational software for scientists and engineers; SLP offers highly specialized computational tools and services for drug discovery and development, leveraging AI and machine learning.)

1. GastroPlus: Software that simulates the absorption and drug interaction of compounds administered to humans and animals.
2. DDDPlus & MembranePlus: Simulation products used for drug discovery and development.
3. DILIsym: Quantitative systems pharmacology software based on mechanistic and mathematical models.
4. Other Mechanistic and Mathematical Model Software: Products like NAFLDsym, IPFsym, RENAsym, and MITOsym, which are based on mechanistic and mathematical models for various simulations.
5. ADMET Predictor: A chemistry-based computer program that takes molecular structures as inputs and predicts their Absorption, Distribution, Metabolism, Excretion, and Toxicity properties.
6. MedChem Designer: Software used for chemistry-based molecular design.
7. MonolixSuite & PKPlus: Modeling and simulation products utilized in pharmacometrics studies.
8. Population Modeling and Simulation Contract Research Services: Services designed to accelerate pharmacometrics studies through expert population modeling and simulation.
9. Training and Consulting Services: Services providing education and guidance to accelerate pharmacometrics studies.
10. Clinical-Pharmacology-Based Consulting Services: Specialized consulting services offered to support regulatory submissions.

Simulations Plus (SLP) sells its drug discovery and development software and services primarily to other companies and organizations. Its major customers fall into the following categories:

• Pharmaceutical companies
• Biotechnology companies
• Agrochemical companies
• Cosmetics companies
• Food companies
• Academic institutions
• Regulatory agencies

Shawn O'Connor, Chief Executive Officer

Shawn O'Connor brings over three decades of executive experience across various industries, including startups and publicly traded companies, with a focus on strategy definition, organizational development, and value creation for investors. Before joining Simulations Plus as CEO in June 2018, he served as president, chief executive officer, and director of Entelos, a company providing quantitative systems pharmacology software and services. Prior to Entelos, Mr. O'Connor was chairman, president, and chief executive officer of Pharsight Corporation, a developer and marketer of software products and services for drug development and commercialization. In this role, he implemented a software product strategy that led to significant revenue, gross profit, and cash flow improvements, increasing the company's valuation by 20 times. Mr. O'Connor also has experience as the CFO of Diasonics, Inc.

Will Frederick, Executive Vice President & Chief Financial Officer

Will Frederick joined Simulations Plus in December 2020 as Chief Financial Officer and Secretary and assumed the additional role of Chief Operating Officer in January 2024. He possesses more than 25 years of financial leadership experience, with a proven track record in developing strategies to drive revenue growth, enhance profitability, manage merger and acquisition activities, and achieve corporate objectives. His extensive global experience spans both publicly traded and privately held companies, including notable organizations such as Pharsight, Entelos, Avaya, The Walt Disney Company, and Ford Motor Company. Notably, Mr. Frederick served as CFO at Pharsight and Entelos during the periods when Shawn O'Connor was CEO, indicating a history of collaboration within the drug development software industry.

John A. DiBella, Chief Revenue Officer

John A. DiBella was appointed Chief Revenue Officer in May 2025, taking responsibility for all revenue-generating activities at Simulations Plus.

Josh Fohey, Chief Operating Officer

Josh Fohey oversees the day-to-day business operations for Simulations Plus. In January 2024, he transitioned from Vice President of Business Development to Senior Vice President, Operations. He joined Simulations Plus in 2019, initially as Director of Operations, and was promoted to Vice President, Operations in 2020. Before joining the company, Mr. Fohey spent 14 years at Covance, where he held various operational, scientific, and business development roles.

Viera Lukacova, Chief Science Officer

Viera Lukacova is responsible for ensuring the scientific precision of Simulations Plus's core software products.

The key risks to Simulations Plus (SLP) include challenges with integrating acquired companies, market uncertainties impacting client spending, and intense competition within its niche market.

1. Acquisition Integration Challenges and Financial Reporting Concerns: Simulations Plus has faced significant hurdles in integrating acquired companies and technologies. In the third quarter of fiscal year 2025, the company reported a substantial non-cash impairment charge of $77.2 million related to prior acquisitions, which resulted in a net loss of $67.3 million for that quarter. This impairment charge specifically highlighted issues with the performance or integration of acquired assets, including those from the Pro-ficiency Holdings, Inc. acquisition, and raised concerns about the effectiveness of internal controls. Furthermore, investigations have been launched into whether the company may have misled investors regarding asset valuations and the dismissal of its independent auditor, Grant Thornton, who had expressed concerns about segment reporting and internal controls over financial reporting before their departure.
2. Market Uncertainties and Client Budget Reductions: The company's financial performance is susceptible to broader market uncertainties within the pharmaceutical and biotechnology sectors. Simulations Plus reduced its fiscal 2025 revenue guidance, citing "significant headwinds" such as market uncertainties related to funding, drug pricing, and potential tariffs. These factors have led to budget reductions, project cancellations, and delays among its client base. While the software segment has shown resilience, the services arm, which contributes a significant portion of revenue, has proven more sensitive to this market volatility. The company has also experienced declining operating and net margins.
3. Competitive Landscape and Niche Market Growth: Simulations Plus operates in a competitive healthcare software industry, facing rivals that are sometimes significantly larger. Although the company possesses industry-leading physiologically-based pharmacokinetic (PBPK) modeling tools and high recurring revenue from its software subscriptions, its future growth is closely tied to successful cross-selling and strategic mergers and acquisitions within its niche market. The challenge lies in expanding beyond its specialized market to achieve broader growth, even as some clients actively cut budgets.

The emergence of integrated, AI-driven drug discovery and development platforms offered by major technology companies or well-funded biotechnology startups poses a clear emerging threat. These platforms leverage advanced artificial intelligence and machine learning algorithms to perform molecular property prediction, ADMET analysis, and complex PBPK/QSP simulations with potentially superior efficiency, integration, and predictive accuracy compared to Simulations Plus's specialized, modular software suite. Such integrated platforms could offer a more holistic and streamlined approach to drug development, potentially reducing the need for multiple, disparate simulation tools and challenging the market for specialized software products.

Expected Drivers of Future Revenue Growth for Simulations Plus (SLP)

Simulations Plus (SLP) is positioned for future revenue growth over the next 2-3 years, driven by several strategic initiatives and favorable market dynamics:

1. Integrated, AI-Enabled Modeling Ecosystem: The company is focused on developing an integrated, AI-enabled modeling ecosystem that spans drug discovery, development, clinical operations, and commercialization. This strategy combines validated science with cloud-scale performance and AI, aiming to deliver new capabilities to the market faster and with greater cohesion. This unified product and technology strategy, including AI-driven workflows and AI-accelerated drug development, is central to their growth plans.
2. Growth in the Services Segment: Simulations Plus has demonstrated strong performance in its services segment, with a 16% increase in Q1 2026 revenue and an 18% increase in the services backlog. The company anticipates that the improvement in services revenue and robust pipeline will precede and contribute to an increase in software activity, thereby driving future overall revenue growth.
3. Annual Software Price Increases: Management has indicated that annual software price increases will contribute to achieving their fiscal year 2026 guidance, suggesting this will be an ongoing factor in revenue growth.
4. Enhanced Cross-Selling through Sales Reorganization: Simulations Plus is restructuring its sales strategy by shifting from a product-focused model to one based on geographical and account ownership. This reorganization is designed to optimize cross-selling opportunities across its diverse product portfolio, which is expected to boost revenue generation.
5. Accelerating Adoption of Model-Informed Drug Development (MIDD) and AI: The biopharmaceutical industry is undergoing a transformation, with companies increasingly prioritizing predictability, transparency, and scientific rigor in drug development. This shift is leading to an accelerating adoption of model-informed drug development (MIDD) and AI, creating a strong market demand for Simulations Plus's innovative solutions.

Share Repurchases

• Simulations Plus announced a share repurchase program authorizing up to $50 million of its common stock on January 4, 2023.
• On January 12, 2023, the company executed an accelerated share repurchase (ASR) agreement totaling $20 million.
• Following the $20 million ASR, $30 million remained available under the previously authorized share repurchase program.

Share Issuance

• Simulations Plus Chief Revenue Officer exercised fully vested stock options for 10,300 shares of common stock on February 6, 2026.
• An equity award of 1,776 shares of common stock was granted to independent directors on January 30, 2026, under the company's 2021 Equity Incentive Plan.
• The number of shares outstanding has generally remained around 20-21 million from late 2020 through late 2025.

Outbound Investments

• Simulations Plus acquired Pro-ficiency Holdings, Inc. and its subsidiaries in June 2024 to extend its reach across the drug development value chain.

Capital Expenditures

• Capital expenditures for the last 12 months (as of early March 2026) were approximately $627,000.
• The company reported $0 in capital expenditures in Q1 2026.