Phathom Pharmaceuticals (PHAT) 2025 Conference September 03, 2025 09:10 AM ET Company ParticipantsSteven Basta - President, CEO & DirectorConference Call ParticipantsKristen Kluska - Equity Research AnalystKristen KluskaOkay, good morning, everybody. I'm Kristen Klosko, one of the biotech analysts at Kantar. Very happy to be hosting Phathom Pharmaceuticals with Steve Bosta, the President and CEO. Thank you so much for being here.Steven BastaThanks for the invitation. It's a pleasure.Kristen KluskaAwesome. M ...

Business Update Steven Basta, President & Chief Executive Officer Q2 2025 Financial Results Robert Breedlove, VP of Finance & Principal Accounting Officer Closing Remarks SECOND QUARTER 2025 EARNINGS CONFERENCE CALL AUGUST 2025 NASDAQ: PHAT Today's Agenda Steven Basta, President & Chief Executive Officer Question & Answer Steven Basta, President & Chief Executive Officer Robert Breedlove, VP of Finance & Principal Accounting Officer 2 Safe harbor This presentation contains forward-looking statements. All st ...

Core Insights - Phathom Pharmaceuticals reported significant revenue growth in Q2 2025, with net revenues of $39.5 million, up from $7.3 million in Q2 2024, driven by the commercial success of VOQUEZNA products [5][6][11] - The company aims to achieve profitability by 2026, supported by a refined commercial strategy focusing on high-value prescribers and strong prescription trends [2][6][11] Business Highlights - Over 580,000 VOQUEZNA prescriptions have been filled to date, reflecting a 49% increase since the last earnings report [6][7] - Approximately 173,000 VOQUEZNA prescriptions were filled in Q2 2025, representing a 36% sequential growth from Q1 2025 [7] - The prescriber base has expanded, with over 29,300 unique healthcare providers writing prescriptions, a 24% increase since the last quarterly update [7] Financial Performance - R&D expenses for Q2 2025 were $9.1 million, an increase from $7.4 million in Q2 2024, primarily due to one-time restructuring charges [11] - SG&A expenses rose to $85.3 million in Q2 2025 from $75.9 million in Q2 2024, driven by higher personnel-related costs [11] - The net loss for Q2 2025 was $75.8 million, compared to $91.4 million in Q2 2024, with a non-GAAP adjusted net loss of $56.5 million [11][19] Market Position and Strategy - The FDA granted 10-year New Chemical Entity exclusivity for VOQUEZNA, extending market protection until May 2032, which is expected to delay generic competition until at least 2033 [7] - The company has shifted its sales strategy to prioritize gastroenterologists over primary care physicians to enhance prescriber engagement [7] Future Outlook - Phathom expects full-year 2025 revenue to be between $165 million and $175 million, based on strong prescription trends and a refined commercial strategy [6][11] - The company anticipates non-GAAP operating expenses to decrease to less than $60 million in Q3 2025 and less than $55 million in Q4 2025 [11]

Ms. Cook served as Senior Vice President, General Counsel, and Corporate Secretary at Sage Therapeutics (Nasdaq: SAGE) from 2015 to 2024. In this role, she was a member of the senior leadership team and led the legal activities across all aspects of the business, including commercialization, regulatory, compliance, intellectual property, and corporate governance. Prior to Sage, she served as General Counsel at Aegerion Pharmaceuticals and at ViaCell, where she also led business and corporate development fun ...

Business Overview - VOQUEZNA aims to transform the landscape of acid-related disorders, targeting a US potential peak revenue opportunity of over $3 billion[11, 12] - The company is experiencing early success with its pricing and access strategy[20] - VOQUEZNA launch is off to a strong start, with over 14,000 total demand[18] Commercial Launch Progress - Over 3,800 filled VOQUEZNA scripts[18] - Over 1,200 unique VOQUEZNA writers[18] - The company has achieved approximately 38% commercial coverage, representing about 60 million commercial lives covered[21] Financial Results - The company had $3814 million in cash as of December 31, 2023[27] - Q4 2023 net revenues were $07 million[27] - Full Year 2023 Non-GAAP R&D expenses were $714 million, and Non-GAAP SG&A expenses were $1010 million[27] - Full Year 2023 GAAP net loss was ($201592) thousand, and Non-GAAP adjusted net loss was ($129713) thousand[29]

Business Update - VOQUEZNA has achieved significant progress in clinical superiority, brand awareness, and patient access during its launch phase[10] - As of April 26, 2024, over 43,000 prescriptions have been written and over 17,500 prescriptions have been filled for VOQUEZNA[12] - VOQUEZNA has secured commercial coverage for approximately 72 million lives[13] - The company is preparing for a potential Non-Erosive GERD launch, with an action date of July 19, 2024, targeting a market of approximately 15 million adults[14] Commercial Launch Progress - Total VOQUEZNA demand includes over 43,000 unique prescriptions written and over 17,500 filled prescriptions[21] - The number of unique VOQUEZNA writers has reached over 3,800[21] - There has been consistent monthly growth in filled prescriptions, reaching approximately 7,520 as of April 26, 2024[26] - Commercial coverage has expanded to 48%, covering approximately 72 million lives, including Cigna Healthcare with over 9 million lives covered[28] Financial Results - Net revenues for Q1 2024 were $1.9 million[36] - Non-GAAP SG&A expenses for Q1 2024 were $57.6 million[40] - The company reported $322.2 million in cash and cash equivalents as of March 31, 2024, which is expected to fund operations through the end of 2026[43]

Business & Product Updates - VOQUEZNA prescriptions filled reached over 143,000[9, 21] - Commercial coverage expanded to over 120 million lives[9, 25] - The company successfully completed an equity follow-on, raising $130 million in gross proceeds[9] - Three VOQUEZNA products are approved across three indications[14] Commercial Launch Progress - Filled prescriptions grew significantly in Q3 2024, reaching approximately 69,000, a ~100% increase compared to Q2 2024[20] - Cumulative writers increased to over 12,400 in Q3 2024, a ~70% increase compared to Q2 2024[24] - Over 80% commercial coverage has been established[25] Financial Results - Net revenues for Q3 2024 were $16.4 million[33, 35] - Non-GAAP SG&A expenses were $71.8 million in Q3 2024[37] - Non-GAAP R&D expenses were $7.4 million in Q3 2024[37] - Adjusted net loss for Q3 2024 was $67.85 million, or $1.05 per share[39] - Cash and cash equivalents totaled $334.7 million as of September 30, 2024[40]

Business Performance & Growth - VOQUEZNA achieved over 300,000 filled prescriptions launch-to-date[13, 24] - Commercial coverage exceeds 80%, covering over 120 million commercial lives[9, 41] - Primary Care Physicians (PCPs) are increasingly contributing to prescription growth, with a ~2x increase in PCP awareness[39] - Approximately 70% of prescriptions in Q4 were refills, indicating continued therapy[31] - HCPs reporting patient requests increased by over 55% since the Direct-to-Consumer (DTC) campaign launch[43] Financial Results - Q4 2024 net revenue reached $29.7 million, reflecting an ~81% increase from the previous quarter[50] - The company reported a GAAP net loss of ($74.451) million for Q4 2024 and ($334.326) million for the full year 2024[54] - Non-GAAP adjusted net loss was ($56.376) million for Q4 2024 and ($262.316) million for the full year 2024[54] - Cash and cash equivalents totaled $297.3 million as of December 31, 2024[55] Legal & Development - The FDA acknowledged the Citizen Petition on 12/11/24, related to VOQUEZNA Orange Book listings[16] - The company is developing a strategy for OTC acid control market, which generates ~$3 billion annually[15]

Financial Data and Key Metrics Changes - For Q4 2024, the company reported net revenues of $29.7 million, representing an 81% sequential increase [54] - Full year 2024 net revenues totaled $55.3 million, with strong revenue growth observed in each quarter [55] - Gross profit for Q4 2024 was $25.8 million, resulting in a gross margin of 87%, an increase of 155 basis points from Q3 [57] - The company reported a GAAP net loss of $74.5 million for Q4 2024, compared to a loss of $79.6 million in Q4 2023 [62] - Cash and cash equivalents as of December 31, 2024, were $297 million, with an additional $100 million available from a debt facility [63] Business Line Data and Key Metrics Changes - VOQUEZNA prescriptions surpassed 300,000, with approximately 118,000 fills in Q4 2024, reflecting over 70% growth compared to Q3 [32][33] - The refill rate for VOQUEZNA in Q4 was about 70%, indicating strong patient retention [35] - The number of physicians writing prescriptions increased to over 20,000, with 75% of them having written more than one prescription [39][40] Market Data and Key Metrics Changes - VOQUEZNA remains covered for over 120 million lives, with commercial coverage above 80% [44] - The company has secured access for the majority of covered lives with a single step through a generic PPI prescription [45] Company Strategy and Development Direction - The company aims to make VOQUEZNA a household name through increased investment in consumer campaigns and targeting primary care physicians [12][41] - Plans to initiate a Phase 2 trial for eosinophilic esophagitis (EoE) are underway, with the belief that VOQUEZNA can serve as a first-line therapy [15][19] - The company is exploring the development of an orally disintegrating tablet (ODT) formulation to enhance patient compliance [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing launch and development goals for VOQUEZNA, anticipating continued momentum in 2025 [10][11] - The company is prepared for potential challenges in Q1 due to typical seasonal slowness but expects growth to resume thereafter [33][65] - Management emphasized the importance of commercial execution and the potential to displace PPIs in the GERD market [70] Other Important Information - The company submitted a Citizen Petition to the FDA for a 10-year exclusivity period for VOQUEZNA products, with a response expected by June 2025 [23][24] - The company is actively monitoring the OTC market opportunity and exploring real-world data related to GERD symptoms among GLP-1 users [22] Q&A Session Summary Question: Timeline for the Citizen Petition and potential outcomes - Management confirmed the FDA is required to respond within 180 days and expressed confidence in their legal position if the decision is unfavorable [76][78] Question: Expectations for Q1 growth - Management indicated that Q1 is expected to be softer than Q4 due to industry dynamics but anticipates growth to resume later in the quarter [79] Question: Phase 3 trial decision timeline - Management expects to have enough data to make a go/no-go decision by midyear [82] Question: Impact of DTC campaigns on prescribing - Management noted a significant increase in physician requests for VOQUEZNA due to DTC campaigns, with a 55% increase in requests reported [88] Question: Early refill trends for NERD - Management indicated that refill rates are tracking well and are in line with expectations for chronic medications [95] Question: Importance of BlinkRx - Management confirmed that BlinkRx remains important for supporting patient access and increasing refill rates [108] Question: ODT formulation and IP strategy - Management clarified that the ODT formulation and pediatric extension will be developed in parallel [114] Question: Resistance from prescribers - Management reported no significant resistance from prescribers, who are welcoming VOQUEZNA's novel mechanism [123]