Phathom Pharmaceuticals(PHAT) - 2024 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - For Q1 2024, the company reported net revenues of $1.9 million, representing a 180% sequential quarterly increase, attributed to growing demand in filled prescriptions and inventory restocking by wholesalers [2] - Gross profit for the quarter was $1.5 million, equating to a gross margin of 78%, with a sequential quarterly increase of about 220 basis points [3] - Non-GAAP adjusted net loss was $64.8 million, or $1.11 loss per share, compared to a loss of $46 million, or $0.80 loss per share in Q4 2023 [7] - Cash and cash equivalents were $322 million, with an additional $150 million available via a debt facility [7][8] Business Line Data and Key Metrics Changes - Non-GAAP R&D spend was $8.2 million, a 16% reduction compared to Q1 2023, primarily due to lower clinical trial costs [4] - Non-GAAP SG&A expenses were $57.6 million, an increase of over 330% compared to the same period in 2023, driven by the build-out of commercial infrastructure and marketing activities [5] Market Data and Key Metrics Changes - The company reported over 43,000 prescriptions written and over 17,500 prescriptions filled for VOQUEZNA, with filled prescriptions increasing by 361% [77] - Approximately 72 million commercially insured lives now have access to VOQUEZNA following its addition to major formularies [66][83] Company Strategy and Development Direction - The company aims to establish widespread commercial coverage throughout 2024 and is focused on the potential approval and label expansion of VOQUEZNA for nonerosive GERD, which represents a significant market opportunity [12][68] - The strategy includes a direct-to-consumer campaign to increase brand awareness and drive demand [65][84] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the financial position, expecting a cash runway through the end of 2026 based on current operating plans and anticipated product revenues [8] - The company is optimistic about the potential for VOQUEZNA to displace PPIs in a large market, with a focus on executing its launch strategy effectively [13][73] Other Important Information - The company is planning to initiate a Phase III trial for as-needed dosing in nonerosive GERD and a Phase II trial for eosinophilic esophagitis later this year [70][71] - The anticipated approval for nonerosive GERD is set for July 19, 2024, which could serve as a significant catalyst for growth [69] Q&A Session Summary Question: Update on fill rate for BlinkRx - Management confirmed that the fill rate has improved to nearly 41%, up from approximately 27% previously reported, indicating increased access and utilization [16][18] Question: Expectations for gross to net improvement - Management noted that while the first quarter saw better-than-expected gross to net due to a temporary issue, they are not providing specific projections for the rest of the year as negotiations with payers are ongoing [21][22] Question: Clarification on prescription split between Blink and IQVIA - Management confirmed that approximately 60% of scripts are now going through retail channels, indicating a shift from cash support to covered scripts as access improves [30][31] Question: Insights on refill rates and patient retention - Management indicated that over 50% of prescribers have written multiple prescriptions, suggesting positive patient experiences and retention [80] Question: Future dynamics of BlinkRx and payer coverage - Management stated that while there may always be some level of coverage through Blink, they expect overall coverage to grow as negotiations with payers progress [45][46]