Phathom Pharmaceuticals, Inc. Q3 FY2025 earnings call

• Welcomed new leadership: Sanjeev Narula as Chief Financial and Business Officer and Nancy Phelan as SVP of Marketing and Analytics.
• Financial highlights: 25% revenue growth, 43% reduction in operating expenses, and 77% decrease in cash usage from Q2.
• Commercial performance: 790,000 filled prescriptions launch-to-date, with 221,000 in Q3. 70% of prescriptions from gastroenterologists.
• Sales force realignment: Focus on gastroenterology, realigned territories to better target gastroenterologists, aiming for 300 sales reps by Q1 2026.
• Clinical program: Initiated Phase II trial in Eosinophilic Esophagitis, with screening underway and first subject expected in Q4. Expect top-line results in 2027.
• Regulatory exclusivity: Exclusivity through May 2032, potentially extending to 2033.
• VOQUEZNA TRIPLE PAK: No disruption in availability, with monitoring continuing.

In the third quarter, Phathom Pharmaceuticals reported net revenue of $49.5 million, representing a 25% quarter-over-quarter growth. Cash operating expenses were $49.3 million, a significant 43% reduction from the previous quarter, and cash usage was less than $15 million, down 77% from Q2. Covered prescriptions grew approximately 23% quarter-over-quarter, and cash prescriptions grew approximately 38% quarter-over-quarter. Revenue from gastroenterologists accounted for 70% of launched prescriptions to-date.

• Updated full-year revenue guidance to $170 million to $175 million.
• Q4 operating expenses expected to be higher due to EoE Phase II trial but still below $55 million. Full-year non-GAAP operating expenses refined to $280 million to $290 million.
• Confidence in achieving operating profitability in 2026 without additional equity financing, supported by current cash balance.

• Risks associated with forward-looking statements, including uncertainties beyond Phathom's control that may materially affect business, results of operations, and stock prices.

Q: Umer Raffat asked about prescription growth and advertising impact.

A: Steve Basta noted revenue guidance balances momentum in gastroenterology accounts and sales force transition in Q4. Sanjeev Narula mentioned expenses streamlined were not driving top line and are sustainable.

Q: Kristen Kluska inquired about PCP focus and territories.

A: Steve Basta explained PCPs who had written scripts stayed, and territories were realigned to better target gastroenterologists with higher concentration.

Q: Paul Choi asked about cash-pay mix and repeat prescriptions.

A: Steve Basta said they don't actively manage mix, and growth in one drives growth in both. Sanjeev Narula noted top line driven by covered scripts. Steve Basta also discussed tracking physician growth up adoption ladder.

Q: Yatin Suneja asked about GI patients and 2026 OpEx.

A: Steve Basta talked about patient types and NERD/GERD, and Sanjeev Narula provided qualitative thoughts on 2026 top line growth and gross to net.

Q: Joseph Stringer asked about confidence in 2026 profitability and marketing analytics.

A: Steve Basta stated confidence in achieving operating cash flow profitability, and Nancy Phelan's analytics work is ongoing.

Q: Anthea on behalf of Dennis Ding asked about sales territory completion and PCP expansion.

A: Steve Basta said territory realignment is complete, hiring ongoing, and PCP expansion driven by NBRx per sales call metrics.

Q: Annabel Samimy asked about physician adoption and sales inflection.

A: Steve Basta said shift in practice patterns due to habit change, needing repetition of conversation and patient feedback.

Q: Matthew Caufield asked about patient proportion and BlinkRx.

A: Steve Basta discussed Blink service improving prescription filling by minimizing co-pay issues.

Q: Chase Knickerbocker asked about gross to net and long-term outlook.

A: Sanjeev Narula said gross to net has been consistent, with pushes and pulls but no significant change expected.

Q: Matthew Caufield asked about patient proportion and BlinkRx.

A: Steve Basta discussed Blink service improving prescription filling by minimizing co-pay issues.