Core Viewpoint - Phathom Pharmaceuticals has appointed Sanjeev Narula as Chief Financial and Business Officer to enhance its leadership team and support its growth strategy, particularly in achieving profitability and increasing shareholder value [1][2][7]. Company Overview - Phathom Pharmaceuticals is a biopharmaceutical company focused on developing and commercializing novel treatments for gastrointestinal diseases, specifically through its product VOQUEZNA, a potassium-competitive acid blocker [5]. Leadership Appointment - Sanjeev Narula brings extensive experience from his previous roles, including Chief Financial Officer at Intra-Cellular Therapies, where he played a significant role in its $14.6 billion acquisition by Johnson & Johnson [3]. - Narula has held senior finance positions at Pfizer, Viatris, and Upjohn, contributing to his expertise in capital strategy, M&A, and financial planning [4]. Product Information - VOQUEZNA is marketed in the U.S. for various gastrointestinal conditions, including heartburn associated with Non-Erosive GERD and as part of treatment for H. pylori infection [5].

Core Viewpoint - Phathom Pharmaceuticals, Inc. (PHAT) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Ratings - The Zacks rating system is based on the Zacks Consensus Estimate, which aggregates EPS estimates from sell-side analysts for the current and following years [2]. - Changes in earnings estimates are strongly correlated with near-term stock price movements, making the Zacks rating system valuable for investors [3][5]. Impact of Institutional Investors - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [5]. - An increase in earnings estimates typically results in a higher fair value for a stock, prompting institutional investors to act accordingly [5]. Business Outlook for Phathom Pharmaceuticals - The upgrade in Zacks Rank for Phathom Pharmaceuticals reflects an improvement in the company's underlying business, which is expected to positively influence its stock price [6]. - Over the past three months, the Zacks Consensus Estimate for Phathom Pharmaceuticals has increased by 4.2%, indicating a positive trend in earnings expectations [9]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [8]. - Phathom Pharmaceuticals' upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10][11].

Summary of Phathom Pharmaceuticals FY Conference Call Company Overview - **Company**: Phathom Pharmaceuticals - **Product**: VOQUEZNA, a treatment for erosive and non-erosive GERD patients - **Conference Date**: September 08, 2025 Key Points Financial Performance - **Revenue Growth**: - Achieved $55 million in revenue last year - Projected revenue for the current year is between $165 million and $175 million, indicating significant growth [6][89] - **Quarterly Performance**: - Reported a $39 million quarter in Q2, reflecting strong uptake among physicians [6] - 36% sequential prescription growth over Q1, with approximately 173,000 VOQUEZNA prescriptions filled [30] Product Differentiation - **Mechanism of Action**: - VOQUEZNA is a potassium-competitive acid blocker (PCAB) with advantages over traditional proton pump inhibitors (PPIs) [7] - Demonstrates rapid onset of action, with patients feeling relief within 30 to 45 minutes [7] - Elevates gastric pH to levels higher than PPIs, providing better symptom relief [8] - **Clinical Efficacy**: - Higher healing rates for erosive esophagitis compared to PPIs, as evidenced by clinical trials [10] Strategic Focus - **Target Market Shift**: - Transitioning focus from primary care physicians to gastroenterologists, who are more likely to prescribe VOQUEZNA [13][15] - Anticipated growth in adoption as gastroenterologists treat patients with severe GERD symptoms [15] - **Direct-to-Consumer Campaign**: - Initial DTC campaign was premature; future campaigns will be more effective once primary care physicians are familiar with VOQUEZNA [21] Market Dynamics - **Patient Journey**: - Patients typically start treatment with primary care physicians and may be referred to gastroenterologists if symptoms persist [25] - Approximately 30% to 40% of GERD patients on chronic PPI therapy still experience breakthrough symptoms, indicating a significant market for VOQUEZNA [40] Challenges and Opportunities - **Adoption Hurdles**: - Physician inertia and long-standing habits of prescribing PPIs pose challenges to VOQUEZNA adoption [44][53] - Overcoming these hurdles requires positive patient feedback and increased physician familiarity with VOQUEZNA [51] - **Label Expansion**: - Planned phase two trial for VOQUEZNA in eosinophilic esophagitis (EOE) could open new revenue streams [73] - EOE market represents tens of millions in potential revenue, with a significant number of PPI scripts annually [82] Regulatory and Exclusivity Insights - **Exclusivity Protection**: - FDA confirmed a May 2032 date for exclusivity protection, with potential for a six-month extension if phase two studies are successful [85][86] Future Outlook - **Path to Profitability**: - Expected to achieve EBIT positive status in 2026, with revenue projections exceeding $165 million for the current year [89][93] - **Operational Efficiency**: - Plans to reduce operating expenses below $60 million in Q3 and below $55 million in Q4 [91] Additional Insights - **Prescription Channels**: - Approximately 68% of prescriptions filled through retail pharmacies, with efforts to optimize both retail and cash pay channels [56][70] - **Patient-Centric Approach**: - Focus on improving patient outcomes and ensuring access to VOQUEZNA through effective prescription practices [72]

Summary of Phathom Pharmaceuticals (PHAT) Conference Call Company Overview - Phathom Pharmaceuticals focuses on a single product, VOQUEZNA, which is a next-generation treatment for gastroesophageal reflux disease (GERD) [3][4] - VOQUEZNA is positioned as a best-in-class treatment, improving upon traditional proton pump inhibitors (PPIs) that have been in use for over 30 years [3][4] Market Opportunity - Approximately 30-40% of GERD patients on PPIs continue to experience pain, representing a significant market opportunity for VOQUEZNA [3][4][57] - The GERD market is substantial, historically exceeding $10 billion, with potential for VOQUEZNA to capture a portion of the market by targeting patients who do not respond to PPIs [55][57] Sales Strategy - The previous sales strategy focused on both primary care physicians and gastroenterologists, with over 60% of salesforce time allocated to primary care [8][10] - The new strategy reallocates salesforce efforts predominantly to gastroenterologists, where the majority of patients in need of VOQUEZNA are located [6][10] - Gastroenterologists are more productive in prescribing VOQUEZNA, yielding four times the productivity compared to primary care calls [10][27] Adoption and Prescribing Patterns - Physicians are categorized based on their prescribing frequency, with a focus on converting those who write few scripts to more frequent prescribers [21][27] - The salesforce is actively working to increase the number of gastroenterologists who adopt VOQUEZNA, aiming to grow the number of consistent writers [27][28] - Positive patient feedback is crucial for driving adoption, as patients report significant improvements in their symptoms when using VOQUEZNA [57][58] Marketing and DTC Campaigns - The direct-to-consumer (DTC) campaign was initially aligned with the broader PPI market strategy but was deemed premature as it directed patients to primary care physicians who were not yet prescribing VOQUEZNA [19][20] - The focus is now on educating gastroenterologists about the benefits of VOQUEZNA and facilitating the prescription process [34][41] Regulatory and Financial Outlook - The company has secured an extended exclusivity period for VOQUEZNA until May 2032, providing a competitive advantage against generics [48][49] - The goal is to achieve profitability and positive cash flow, with expectations of reaching EBIT positive operations by next year [49][50] Future Growth and Pipeline - Phathom Pharmaceuticals is considering in-licensing additional products to build a stable GI business in the future, but the immediate focus remains on driving revenue from VOQUEZNA [45][46] Conclusion - The path to significant revenue growth is clear, with a target of engaging 10,000 gastroenterologists to prescribe VOQUEZNA regularly, leveraging positive patient experiences to drive adoption [58]

Core Viewpoint - Phathom Pharmaceuticals, Inc. (PHAT) has shown a significant price increase of 21% over the past four weeks, with a mean price target of $20.5 indicating an upside potential of 87.2% from the current price of $10.95 [1] Price Targets and Analyst Estimates - The mean estimate consists of eight short-term price targets with a standard deviation of $8.02, indicating variability among analysts [2] - The lowest estimate is $5.00, suggesting a potential decline of 54.3%, while the highest estimate is $29.00, indicating a potential increase of 164.8% [2] - A low standard deviation among price targets suggests a high degree of agreement among analysts regarding the stock's price movement [9] Earnings Estimates and Analyst Agreement - There is strong agreement among analysts regarding the company's ability to report better earnings than previously predicted, which supports the view of potential upside [4] - Over the last 30 days, the Zacks Consensus Estimate for the current year has increased by 4.2%, with one estimate moving higher and no negative revisions [12] - PHAT currently holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13] Caution on Price Targets - While price targets are often sought after by investors, they can mislead more often than guide, and should not be the sole basis for investment decisions [3][7][10] - Analysts may set overly optimistic price targets due to business incentives, which can inflate expectations [8]

Core Insights - Phathom Pharmaceuticals, Inc. clarified that a Schedule 13D filing by Frazier Life Sciences will include administrative changes to its reporting approach without indicating a reduction in ownership position by any Frazier fund or individual in Phathom [1] - The differences in the breakout of holdings between funds and individuals are attributed solely to clarifying changes in Frazier's reporting approach, not due to any sale of shares [2] Company Overview - Phathom Pharmaceuticals is a biopharmaceutical company focused on developing and commercializing novel treatments for gastrointestinal diseases [3] - The company has in-licensed exclusive rights to vonoprazan, a first-in-class potassium-competitive acid blocker (PCAB), which is marketed in the U.S. under the brand VOQUEZNA® for various gastrointestinal conditions [3]

Financial Data and Key Metrics Changes - The company reported net revenues of $39.5 million for Q2 2025, representing a 39% increase compared to Q1 2025, driven by increased adoption of Vopresna [24][17] - Non-GAAP operating expenses for Q2 2025 were $86.1 million, a decrease of $12 million from Q1 2025, reflecting early cost-saving initiatives [25][26] - The company ended the quarter with approximately $150 million in cash, which is expected to support operations until profitability in 2026 [29][18] Business Line Data and Key Metrics Changes - Over 580,000 Vopresna prescriptions have been filled since launch, with a 49% growth in the last fourteen weeks [6] - In Q2, approximately 173,000 prescriptions were filled, reflecting a 36% growth over Q1 [7] - 68% of Q2 Vopresna prescriptions were filled through the retail channel, with a slight decrease due to the rollout of a cash pay option for Medicare patients [7][8] Market Data and Key Metrics Changes - Commercial access remains above 80% of lives covered, with more than half requiring only a single step edit or less [7] - The company has seen a 24% increase in unique healthcare providers (HCPs) writing Vopresna prescriptions compared to Q1 [8] Company Strategy and Development Direction - The company is focusing on gastroenterologists as the primary target for sales efforts, believing this will lead to accelerated revenue growth [11][12] - A phase two trial in eosinophilic esophagitis (EOE) is set to begin in Q4 2025, which may provide a path to extend exclusivity [16][17] - The company anticipates revenue guidance of $165 to $175 million for the full year 2025, above current analyst estimates [18][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving profitability by 2026, emphasizing the importance of Vopresna as a treatment option for GERD patients who do not respond to PPIs [21][30] - The company is committed to financial discipline while continuing to invest in key areas driving revenue growth [30][31] Other Important Information - The FDA has updated the orange book to reflect exclusivity for Vopresna through May 2032, enhancing the net present value (NPV) of the product [15] - The company has implemented cost-saving initiatives that have already shown a $12 million reduction in non-GAAP operating expenses compared to Q1 2025 [25][26] Q&A Session Summary Question: How will the sales force drive more depth and frequency of writing prescriptions? - The sales force has realigned territories to focus on gastroenterologists, dropping over 20,000 primary care physicians who had not converted [34][35] - Increased call frequency with gastroenterologists is expected to lead to higher prescription writing [36][38] Question: Is the anticipated revenue acceleration already included in the current guidance? - Management believes long-term acceleration is a driver to the upside, but it may take one to three quarters for the new targeting strategy to show consistent growth [41][42] Question: What is the tipping point for transitioning from gastroenterologists to primary care physicians? - Management indicated that significant revenue potential exists within the GI market alone, and primary care is viewed as an additive opportunity [50][51] Question: How are cost cuts being implemented and their impact on growth? - Major cost savings are coming from eliminating direct-to-consumer promotional programs and adjusting third-party vendor contracts [59][62] Question: What is the current average cash pay amount through BlinkRx? - The standard cash pay amount through BlinkRx is $50, with a $25 copay for insured patients [93][95]

Business Performance - Filled VOQUEZNA prescriptions have exceeded 580,000 since launch, compared to over 390,000 as of April 18, 2025[9] - Quarterly filled prescriptions reached approximately 173,000 in Q2 2025, a roughly 36% increase from the previous quarter[10] - Cumulative writers have surpassed 29,300 as of July 18, 2025, up from over 23,600 as of April 11, 2025[13] - Gastrointestinal (GI) specialists account for 70% of the launch-to-date volume, while Primary Care Physicians (PCP) and other non-GI specialties make up 30%[17] - The company is increasing calls on approximately 37,000 Healthcare Professionals (HCPs), focusing on nearly all GIs, all existing writers, and high decile PCPs in Q3 2025[18] Financial Results and Guidance - The company had $1496 million in cash and cash equivalents as of June 30, 2025[28] - The company anticipates reaching profitability in 2026[28] - Net revenue for FY 2025 is projected to be between $165 million and $175 million[22] - Non-GAAP operating expenses are forecasted to be less than $60 million for Q3 2025 and less than $55 million for Q4 2025[22] - Quarterly net revenue increased from $73 million in Q2 2024 to $395 million in Q2 2025[31]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) Unaudited statements show rising product revenue but continued net losses and a widening stockholders' deficit [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets) The balance sheet reflects a significant decrease in cash and a widening stockholders' deficit to $405.8 million Condensed Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $149,569 | $297,263 | | Total current assets | $218,875 | $360,134 | | Total assets | $250,220 | $378,318 | | Total current liabilities | $91,823 | $85,728 | | Total liabilities | $656,054 | $631,898 | | Total stockholders' deficit | $(405,834) | $(253,580) | [Condensed Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Q2 2025 saw a surge in product revenue to $39.5 million, though the net loss remained high at $75.8 million Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $39,503 | $7,324 | $68,023 | $9,236 | | Gross profit | $34,465 | $5,948 | $59,261 | $7,434 | | Total operating expenses | $94,389 | $83,248 | $198,047 | $154,688 | | Loss from operations | $(59,924) | $(77,300) | $(138,786) | $(147,254) | | Net loss | $(75,810) | $(91,446) | $(170,126) | $(174,298) | | Net loss per share | $(1.05) | $(1.56) | $(2.36) | $(2.98) | [Condensed Statements of Cash Flows](index=6&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) Net cash used in operations increased to $147.7 million for the first six months of 2025 Cash Flow Summary for Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(147,659) | $(139,741) | | Net cash used in investing activities | $(115) | $(86) | | Net cash provided by financing activities | $80 | $34,671 | | **Net decrease in cash** | **$(147,694)** | **$(105,156)** | [Notes to Condensed Unaudited Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Unaudited%20Financial%20Statements) Notes detail the VOQUEZNA launch, debt obligations, and a May 2025 restructuring plan - The FDA approved VOQUEZNA for Erosive GERD and H. pylori in late 2023, with commercial launch in Q4 2023, and an additional approval for Non-Erosive GERD was granted on **July 17, 2024**[22](index=22&type=chunk) - Management believes it has **sufficient working capital** to fund operations through at least the next twelve months from the issuance date of the financial statements[25](index=25&type=chunk) - For the first six months of 2025, **three customers accounted for 72% of product sales** and represented 82% of the accounts receivable balance as of June 30, 2025[38](index=38&type=chunk) - In May 2025, the company implemented a restructuring plan, reducing its workforce by 28 employees (approx. 6%) and incurring **total charges of $8.0 million**[104](index=104&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management highlights the strong VOQUEZNA launch, rising revenues, and sufficient liquidity for the next year [Overview](index=24&type=section&id=Overview) The company's focus is on commercializing VOQUEZNA, which shows strong prescription momentum post-launch - As of July 25, 2025, **over 580,000 prescriptions** for VOQUEZNA products have been filled by more than 29,300 prescribers since launch[110](index=110&type=chunk) - On July 17, 2024, the FDA approved VOQUEZNA 10 mg tablets for the relief of heartburn associated with **Non-Erosive GERD**[109](index=109&type=chunk) - The company has been informed of a potential supply disruption for clarithromycin, a component of VOQUEZNA TRIPLE PAK, which accounts for **approximately 1% of total revenue**[113](index=113&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Q2 2025 revenue surged to $39.5 million, with increased SG&A expenses driven by launch and restructuring costs Comparison of Three Months Ended June 30 (in thousands) | Account | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Product revenue, net | $39,503 | $7,324 | $32,179 | | Research and development | $9,076 | $7,376 | $1,700 | | Selling, general and administrative | $85,313 | $75,872 | $9,441 | | Net loss | $(75,810) | $(91,446) | $15,636 | Comparison of Six Months Ended June 30 (in thousands) | Account | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Product revenue, net | $68,023 | $9,236 | $58,787 | | Research and development | $18,260 | $16,806 | $1,454 | | Selling, general and administrative | $179,787 | $137,882 | $41,905 | | Net loss | $(170,126) | $(174,298) | $4,172 | - The **$41.9 million increase in SG&A** for the first six months of 2025 was primarily due to a $32.5 million increase in advertising and promotional expenses for the VOQUEZNA launch and an $8.9 million increase in personnel-related expenses from restructuring[137](index=137&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) The company holds $149.6 million in cash and believes it has sufficient capital to fund operations for one year - The company had **cash and cash equivalents of $149.6 million** as of June 30, 2025[139](index=139&type=chunk) - The company has a term loan agreement with Hercules, which was amended to increase the principal amount up to $300 million, but **does not expect to meet the revenue threshold** to draw the final $50 million tranche[144](index=144&type=chunk)[150](index=150&type=chunk) - The Revenue Interest Financing Agreement entitles investors to a **10% royalty on net sales** of vonoprazan products until they receive aggregate payments equal to 200% of their investment[156](index=156&type=chunk) Cash Flow Summary for Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(147,659) | $(139,741) | | Net cash used in investing activities | $(115) | $(86) | | Net cash provided by financing activities | $80 | $34,671 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Market risk exposures remain materially unchanged from the 2024 Form 10-K disclosures - There have been **no material changes** to the company's market risk since the disclosures in the 2024 Form 10-K[176](index=176&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025 - Management evaluated disclosure controls and procedures and concluded **they were effective** as of June 30, 2025[178](index=178&type=chunk) - **No material changes** in internal control over financial reporting occurred during the second quarter of 2025[179](index=179&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no current involvement in any material legal proceedings - The company is **not currently a party** to any material legal proceedings[181](index=181&type=chunk) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) Risk factors remain materially unchanged from those disclosed in the 2024 Annual Report - **No material changes** have occurred to the risk factors disclosed in the 2024 Form 10-K[182](index=182&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or issuer repurchases occurred during the period - There were **no unregistered sales of equity securities** or issuer repurchases of equity securities in the reported period[183](index=183&type=chunk)[184](index=184&type=chunk) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed, including new executive separation and employment agreements - The report includes several exhibits, such as **separation agreements** with Azmi Nabulsi and Molly Henderson, and an employment letter with Anne Marie Cook[190](index=190&type=chunk)

[Phathom Pharmaceuticals Second Quarter 2025 Earnings Release](index=1&type=section&id=Phathom%20Pharmaceuticals%20Second%20Quarter%202025%20Earnings%20Release) Phathom Pharmaceuticals reported strong Q2 2025 results, driven by VOQUEZNA's commercial success, improved financial performance, and key regulatory milestones [Business Highlights and Commercial Performance](index=1&type=section&id=Business%20Highlights%20and%20Commercial%20Performance) Phathom Pharmaceuticals reported strong commercial momentum for its GI treatment, VOQUEZNA, in Q2 2025, with net revenues reaching $39.5 million. Total prescriptions surpassed 580,000, showing a 49% increase since the previous report. The company has shifted its commercial strategy to focus on high-value prescribers, primarily gastroenterologists (GIs), and maintains robust commercial access with coverage for over 120 million lives VOQUEZNA Commercial Metrics | Metric | Value | Growth | Source Date | | :--- | :--- | :--- | :--- | | Total Prescriptions Filled | > 580,000 | 49% since May 1, 2025 | July 25, 2025 | | Q2 2025 Prescriptions Filled | ~173,000 | 36% QoQ | Q2 2025 | | Unique HCP Prescribers | > 29,300 | 24% since last quarter | July 18, 2025 | - The company has implemented a strategic shift to prioritize gastroenterologists (GIs) in its sales strategy, who currently account for approximately **70% of all filled VOQUEZNA prescriptions**[5](index=5&type=chunk) - VOQUEZNA has commercial coverage for over **120 million lives**, with more than half of these requiring only one prior proton pump inhibitor (PPI) step before approval[5](index=5&type=chunk) [Second Quarter 2025 Financial Results](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Results) In Q2 2025, Phathom's net revenues surged to $39.5 million from $7.3 million in Q2 2024, driven by the VOQUEZNA launch. Operating expenses increased to $94.4 million, primarily due to commercial investments and restructuring charges. However, operating expenses saw a sequential decrease from Q1 2025 due to cost-saving initiatives. The company reported a reduced net loss of $75.8 million compared to $91.4 million in the prior-year period [Key Financial Metrics](index=2&type=section&id=Key%20Financial%20Metrics) This section details Phathom's Q2 2025 financial performance, highlighting significant increases in net revenues and changes in operating expenses and net loss compared to Q2 2024 Q2 2025 vs Q2 2024 Financial Performance (in millions) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Revenues | $39.5 | $7.3 | +$32.2 | | R&D Expenses | $9.1 | $7.4 | +$1.7 | | SG&A Expenses | $85.3 | $75.9 | +$9.4 | | Total Operating Expenses | $94.4 | $83.2 | +$11.2 | | Net Loss | $(75.8) | $(91.4) | +$15.6 (Improved) | | Non-GAAP Adjusted Net Loss | $(56.5) | $(73.3) | +$16.8 (Improved) | - The increase in R&D and SG&A expenses was primarily driven by one-time personnel-related restructuring charges and continued commercial investment in the VOQUEZNA launch[7](index=7&type=chunk) - Operating expenses decreased sequentially from **$103.7 million in Q1 2025 to $94.4 million in Q2 2025**, reflecting cost savings from the company's restructuring[7](index=7&type=chunk) [Financial Position and Outlook](index=3&type=section&id=Financial%20Position%20and%20Outlook) The company's financial position as of June 30, 2025, is presented, along with its full-year 2025 revenue guidance and future operating expense targets - As of June 30, 2025, the company held **$149.6 million in cash and cash equivalents**, which is believed to be sufficient to fund operations and achieve profitability in 2026 (excluding stock-based compensation)[13](index=13&type=chunk) 2025 Financial Guidance | Metric | Guidance Range/Target | | :--- | :--- | | Full-Year 2025 Revenue | $165 million to $175 million | | Q3 2025 Non-GAAP Operating Expenses | < $60 million | | Q4 2025 Non-GAAP Operating Expenses | < $55 million | [Regulatory Updates and Corporate Developments](index=2&type=section&id=Regulatory%20Updates%20and%20Corporate%20Developments) During the second quarter, Phathom secured a significant regulatory milestone with the FDA updating the Orange Book to reflect 10-year New Chemical Entity (NCE) exclusivity for VOQUEZNA through May 2032, potentially delaying generic entry until 2033. The company also strengthened its leadership by appointing Anne Marie Cook, J.D., as Chief Legal Officer - The FDA updated the Orange Book to grant **10-year New Chemical Entity (NCE) exclusivity for VOQUEZNA tablets**, extending market protection through May 2032[7](index=7&type=chunk) - Based on typical ANDA review timelines, the company believes generic competition is unlikely before **2033**[7](index=7&type=chunk) - Phathom appointed Anne Marie Cook, J.D., as Chief Legal Officer and Corporate Secretary to strengthen its leadership team[7](index=7&type=chunk) [Financial Statements and Non-GAAP Reconciliation](index=5&type=section&id=Financial%20Statements%20and%20Non-GAAP%20Reconciliation) The report includes unaudited condensed financial statements as of June 30, 2025, and for the three and six months then ended. These statements detail the company's balance sheet and statement of operations. A reconciliation of GAAP to non-GAAP financial measures is also provided, adjusting for items like stock-based compensation and non-cash interest expenses to offer a clearer view of ongoing operational performance [Condensed Balance Sheets](index=5&type=section&id=Condensed%20Balance%20Sheets) This section provides a snapshot of Phathom's financial position, detailing assets, liabilities, and stockholders' deficit as of June 30, 2025, and December 31, 2024 Condensed Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $149,569 | $297,263 | | Total assets | $250,220 | $378,318 | | Total liabilities | $656,054 | $631,898 | | Total stockholders' deficit | $(405,834) | $(253,580) | [Condensed Statements of Operations](index=5&type=section&id=Condensed%20Statements%20of%20Operations) This section outlines Phathom's operational performance for the three months ended June 30, comparing product revenue, gross profit, operating expenses, and net loss for 2025 and 2024 Statement of Operations - Three Months Ended June 30 (in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Product revenue, net | $39,503 | $7,324 | | Gross profit | $34,465 | $5,948 | | Total operating expenses | $94,389 | $83,248 | | Loss from operations | $(59,924) | $(77,300) | | Net loss | $(75,810) | $(91,446) | | Net loss per share | $(1.05) | $(1.56) | [Reconciliation of GAAP to Non-GAAP Financial Measures](index=6&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) This section reconciles GAAP net loss to non-GAAP adjusted net loss for the three months ended June 30, adjusting for non-cash items to provide a clearer view of core operational profitability GAAP to Non-GAAP Net Loss Reconciliation - Three Months Ended June 30 (in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | GAAP net loss | $(75,810) | $(91,446) | | Stock-based compensation expense | $8,272 | $6,099 | | Non-cash interest on revenue interest financing liability | $10,306 | $11,553 | | Interest expense related to amortization of debt discount | $734 | $499 | | **Non-GAAP adjusted net loss** | **$(56,498)** | **$(73,295)** |