Phathom Pharmaceuticals (PHAT) FY2025 10-K Risk Factors: 29 New, 26 Dropped

What the changes say

Phathom Pharmaceuticals faces intense competition, reliance on VOQUEZNA commercial success, and strict ongoing regulatory requirements following product launches.

What changed since the prior 10-K

New

NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
Biopharmaceutical commercialization and product development both involve a substantial degree of risk
We launched VOQUEZNA products in late 2023 with no prior commercial-scale sales or manufacturing experience, making future predictions uncertain.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
Agreement with Hercules contains minimum cash and performance financial covenants and our Revenue Interest Financing Agreement also contains minimum cash covenants
Our Hercules and Revenue Interest Financing agreements impose minimum cash and financial performance covenants.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
As a commercial-stage company with FDA-approved products, we are subject to ongoing regulatory obligations and failure to comply with these requirements or changes in regulatory rules could materially adversely affect our business or result in significant additional expense
As a commercial-stage company, we face costly post-approval requirements such as pregnancy registries and pediatric studies for VOQUEZNA.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
injunctions or the imposition of civil or criminal penalties
Failure to adapt to new or changing regulatory laws could result in enforcement actions, civil or criminal penalties, and injunctions.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
monetary penalties, repayment obligations, and administrative dispute resolution proceedings. Legislative or regulatory changes could further expand the scope or obligations of the 340B program
Participating in federal pricing programs like the VA Federal Supply Schedule exposes us to civil monetary penalties for false information.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
Competition in the markets for our approved products is expected to increase, and we may also face competition with respect to any product candidates we may develop, in each case which could materially adversely affect our business, results of operations and prospects
We face intense competition from larger, better-funded pharmaceutical companies developing GI disease treatments and alternative therapies.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
For the treatment of H. pylori infection, VOQUEZNA TRIPLE PAK and VOQUEZNA DUAL PAK compete primarily with generic PPI-based triple and quadruple therapies, as well as with branded therapies such as Talicia, a co-formulated capsule containing omeprazole, amoxicillin and rifabutin, marketed by RedHill Biopharma Ltd
VOQUEZNA TRIPLE PAK and DUAL PAK compete with generic PPI therapies and branded treatments like RedHill's Talicia.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
If the market opportunities for our approved products, including VOQUEZNA, or for any future product candidates we may develop, are smaller than we expect, our business, results of operations and prospects could be adversely affected
Our market opportunity projections for VOQUEZNA are based on estimates and literature that may prove incorrect.
NewRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
If our efforts to develop, maintain and effectively deploy sales, marketing and distribution capabilities are unsuccessful, we may not be able to successfully commercialize our approved products or any product candidates we may develop and generate revenues at the levels and on the timing we expect
Our targeted sales force focused on gastroenterologists may not achieve sufficient adoption or utilization of our products.
NewRisks Related to the Development and Regulatory Approval of Product Candidates
Our future growth depends on our ability to develop vonoprazan for additional indications or formulations and to successfully develop or acquire additional product candidates
Our future growth depends on developing vonoprazan for additional indications, such as eosinophilic esophagitis, which may fail.
NewRisks Related to the Development and Regulatory Approval of Product Candidates
obtaining and maintaining robust intellectual property protection or regulatory exclusivities
We may fail to obtain robust intellectual property protection or regulatory exclusivities for new vonoprazan formulations.
NewRisks Related to the Development and Regulatory Approval of Product Candidates
Clinical development is lengthy, expensive and uncertain, and delays or failures in our clinical trials could limit our ability to obtain additional regulatory approvals and adversely affect our business
Clinical drug development is lengthy and uncertain, and our current trial of vonoprazan in eosinophilic esophagitis may fail.
NewRisks Related to the Development and Regulatory Approval of Product Candidates
The conduct of clinical trials is subject to extensive regulation in the United States and other territories, and regulatory requirements and policies may change. New processes and requirements for the authorization and oversight of clinical trials may affect the planning, conduct, timing and cost of trials
NewRisks Related to the Development and Regulatory Approval of Product Candidates
Obtaining regulatory approval for product candidates, including additional indications or formulations of approved products, is subject to extensive regulation and is costly, time-consuming and uncertain
NewRisks Related to the Development and Regulatory Approval of Product Candidates
clinical data needed for approval or encounter other issues such as unexpected side effects or formulation-related technical hurdles, and we may decide to pause or such development efforts
NewRisks Related to the Development and Regulatory Approval of Product Candidates
If regulatory authorities do not accept data from our foreign clinical trials for future regulatory submissions, we may be required to conduct additional clinical trials, which would be costly and time consuming and could delay or prevent our development efforts
NewRisks Related to the Development and Regulatory Approval of Product Candidates
diminished protection of intellectual property in some countries
NewRisks Related to the Development and Regulatory Approval of Product Candidates
Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations, government shutdowns or policy changes could delay regulatory review and approval processes and adversely affect our business
NewRisks Related to Our Reliance on Third Parties
timelines. Though we carefully manage our relationships with our CROs, investigators and other third parties, we may encounter challenges or delays in the future and these delays or challenges may have a material adverse impact on our business, financial condition and prospects
NewRisks Related to Our Business Operations and Industry
future accounting pronouncements or changes in our accounting policies
NewRisks Related to Our Business Operations and Industry
reforms could reduce the ultimate demand for vonoprazan and any future product candidates, if approved, or put pressure on our product pricing, which could negatively affect our business, results of operations, financial condition and prospects
NewRisks Related to Our Business Operations and Industry
We and others are subject to ongoing adverse event reporting obligations for our approved products and any failure to comply with these requirements could result in regulatory action that would materially harm our business
NewRisks Related to Our Business Operations and Industry
expenditure and resources. Any failure or perceived failure to comply with the requirements of these laws could adversely affect our business, results of operations and financial condition
NewRisks Related to Our Business Operations and Industry
Our business may be affected by the evolving regulatory framework for AI Technologies
NewRisks Related to Our Intellectual Property
adverse determination in a judicial or administrative proceeding, or the failure to obtain necessary licenses, could prevent us from commercializing our VOQUEZNA products and any future product candidates, which could harm our business, financial condition and operating results
NewRisks Related to Our Intellectual Property
those of our current and future licensors and the enforcement or defense of our future issued patents or those of our current and future licensors, all of which could have a material adverse effect on our business, financial condition, results of operations and prospects
NewRisks Related to Our Common Stock
We have ceased to qualify as a smaller reporting company in 2026, and as a result we are subject to increased reporting, compliance and internal control requirements, which may increase our costs and strain management resources
NewRisks Related to Our Common Stock
Our business may be adversely affected by epidemics, pandemics or other public health emergencies
NewRisks Related to Our Common Stock
our products, delaying regulatory reviews or inspections, constraining our workforce or that of our third-party manufacturers, CROs, suppliers or service providers, and impairing our ability to raise capital or access the financial markets on acceptable terms

Dropped

DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk
Received first regulatory approvals in 2022 before commercializing VOQUEZNA in 2023.
DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
the costs associated with any products or technologies that we may in-license or acquire
DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
Following receipt of regulatory approval, we are subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense
DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
The occurrence of any event or penalty described above may inhibit our ability to commercialize our current products and any future product candidates and generate revenue and could require us to expend significant time and resources in response and could generate negative publicity
DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
We participate in various governmental programs, such as the Medicaid Drug Rebate Program, that impose extensive drug price reporting and payment obligations on pharmaceutical manufacturers
Costs associated with in-licensed products or technologies and uncertain clinical trials.
DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
We face significant competition, and if our competitors develop technologies or product candidates more rapidly than we do or their technologies are more effective, our ability to develop and successfully commercialize products may be adversely affected
DroppedRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
If the market opportunities for VOQUEZNA, VOQUEZNA TRIPLE PAK, VOQUEZNA DUAL PAK, or any future product candidates are smaller than we believe they are, our revenue may be adversely affected, and our business may suffer
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
We depend entirely on the success of VOQUEZNA and other products containing vonoprazan. If we do not successfully commercialize VOQUEZNA in its approved indications, or we experience significant delays in doing so, we may never become profitable
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
qualifying for, maintaining, enforcing and defending our intellectual property rights and claims
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and the results of preclinical studies and early clinical trials are not necessarily predictive of future results
Post-approval obligations and restrictions imposed by FDA, EMA or other regulatory authorities.
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
Any difficulties or delays in the commencement or completion, or termination or suspension, of our ongoing or future clinical trials could result in increased costs to us, delay or limit our ability to generate revenue and adversely affect our commercial prospects
Regulatory policies may change and delay future product candidate approvals.
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
third-party contractors not performing data collection or analysis in a timely or accurate manner; or
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
We may find it difficult to enroll patients in our clinical trials. If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected
Participation in governmental programs like Medicaid and Medicare imposing price reporting obligations.
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
clinical trials if we are unable to locate a sufficient number of eligible patients to participate in the clinical trials required by the FDA or comparable foreign regulatory authorities
Facing significant competition from companies developing technologies more rapidly.
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
Our assumptions used in determining expected clinical trial timelines may not be correct, and we may experience delays in enrollment, which would result in the delay of completion of such trials beyond our expected timelines
Market opportunities and disease prevalence estimates for VOQUEZNA may be smaller than expected.
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
Any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, and could significantly harm our business, financial condition, and results of operations
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
an as needed treatment for Non-Erosive GERD and any potential clinical trial we conduct studying as needed dosing of vonoprazan in Non-Erosive GERD patients may not succeed including as a result of our design and enrollment criteria
Dependence entirely on the success of VOQUEZNA and vonoprazan products.
DroppedRisks Related to the Development and Regulatory Approval of Product Candidates
Interim, top-line and preliminary data from clinical trials that we or others announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data
Qualifying for, maintaining, and defending intellectual property rights and claims.
DroppedRisks Related to Our Reliance on Third Parties
an inability to meet commercial demands for our current products or any future product candidates
Clinical drug development is a lengthy and expensive process with uncertain outcomes.
DroppedRisks Related to Our Business Operations and Industry
the timing and success or failure of additional clinical trials for vonoprazan or preclinical studies or clinical trials for any future product candidates or competing product candidates, or any other change in the competitive landscape of our industry, including consolidation among our competitors or partners
Difficulties or delays in clinical trials resulting in increased costs and delayed revenue.
DroppedRisks Related to Our Business Operations and Industry
We have substantially increased the size of our organization over the past year, and we may encounter difficulties in managing our growth and expanding our operations successfully
Risks related to third-party contractors failing in data collection or becoming debarred.
DroppedRisks Related to Our Business Operations and Industry
value to foreign government officials, employees of public international organizations and foreign government owned or affiliated entities, candidates for foreign political office, and foreign political parties or officials thereof
DroppedRisks Related to Our Business Operations and Industry
We and others, including any of our potential future collaborators, will be required to report to regulatory authorities if any of our approved products cause or contribute to adverse medical events, and any failure to do so would result in sanctions that would materially harm our business
DroppedRisks Related to Our Intellectual Property
PGR, IPR, and derivation proceedings. An adverse determination in any such submission or proceeding could reduce the scope or enforceability of, or invalidate, our patent rights, which could adversely affect our competitive position
DroppedRisks Related to Our Common Stock
We are a smaller reporting company within the meaning of the Securities Act, and if we decide to take advantage of certain exemptions from various reporting requirements applicable to smaller reporting companies, our common stock could be less attractive to investors
DroppedRisks Related to Our Common Stock
Our business is subject to risks arising from epidemic diseases, such as the COVID-19 pandemic

Reworded

85% rewrittenRisks Related to Our Reliance on Third Parties
termination or nonrenewal of the agreement by the third party at a time that is costly or inconvenient for us
Updated to clarify supplier risks involving Catalent, Evonik, or Sandoz and the lack of redundant supply chains.
85% rewrittenRisks Related to Our Common Stock
If we fail to maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline
Added the specific requirement that our independent auditor must attest to internal controls beginning in fiscal year 2026.
75% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
We have incurred significant operating losses since inception and may never achieve or maintain profitability
Updated net loss figures to $221.2 million for 2025 and $334.3 million for 2024, with an accumulated deficit of $1.5 billion.
Was: We have incurred significant operating losses since inception and anticipate that we will continue to incur substantial operating losses for the foreseeable future and may never achieve or maintain profitability
73% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
We may require substantial additional financing to achieve our goals, finance our operations or meet our financial obligations, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could materially adversely affect our business
Removed specific Takeda milestone and royalty payment references, broadening commercialization and expansion cost risks.
Was: We may require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development programs, commercialization efforts or other operations
70% rewrittenRisks Related to Our Business Operations and Industry
Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or any guidance we may provide
Added sensitivity to market acceptance and payer access specifically concerning VOQUEZNA as a GERD treatment.
68% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
incur additional legal, accounting and other expenses in connection with operating as a public company
Refocused profitability requirements explicitly on successfully commercializing VOQUEZNA for GERD treatment.
64% rewrittenRisks Related to Our Business Operations and Industry
If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our products
Added distributors to the list of entities that might bring product liability claims against us.
59% rewrittenRisks Related to the Development and Regulatory Approval of Product Candidates
such authorities may not accept a submission due to, among other reasons, the content or formatting of the submission
Added FDA requirements for additional costly clinical trials, including pediatric trials, for U.S. approvals.
58% rewrittenRisks Related to Our Common Stock
The trading price of the shares of our common stock has been, and is likely to continue to be, highly volatile, and purchasers of our common stock could incur substantial losses
58% rewrittenRisks Related to Our Business Operations and Industry
U.S. legislation, sanctions, trade restrictions and other foreign regulatory requirements could adversely impact the supply of material from foreign CROs and CMOs to us or our ability to secure government commitments to purchase potential therapies
58% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. If we are found or alleged to have improperly promoted off-label uses, we may become subject to significant liability
56% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates
54% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
We currently rely entirely on the commercial success of our VOQUEZNA products, which depends upon the degree of market acceptance of such products by physicians, patients, healthcare payers and others in the medical community
Was: The commercial success of our current products or any future product candidates will depend upon the degree of market acceptance of such product candidates by physicians, patients, healthcare payers and others in the medical community
53% rewrittenRisks Related to Our Reliance on Third Parties
The loss of, or significant reduction in business from, one or more of our major customers could significantly reduce our revenue, earnings or other operating results
53% rewrittenRisks Related to Our Business Operations and Industry
establishment of a Center for Medicare Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending
53% rewrittenRisks Related to Our Reliance on Third Parties
We may seek to enter into collaborations, licenses and other similar arrangements and may not be successful in doing so, and even if we are, we may not realize the benefits of such relationships
53% rewrittenRisks Related to Our Intellectual Property
Although no third party has asserted a claim of patent infringement against us as of the date of this annual report, others may hold proprietary rights that could prevent our VOQUEZNA products and any future product candidates from being marketed
Was: Although no third party has asserted a claim of patent infringement against us as of the date of this annual report, others may hold proprietary rights that could prevent VOQUEZNA and any future product candidates from being marketed
48% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
We may lack the necessary expertise, personnel and resources to successfully commercialize VOQUEZNA, VOQUEZNA DUAL PAK, and VOQUEZNA TRIPLE PAK and any future product candidates that may receive regulatory approval, on our own or together with collaborators
Was: We may lack the necessary expertise, personnel and resources to successfully commercialize VOQUEZNA, VOQUEZNA TRIPLE PAK, VOQUEZNA DUAL PAK, and any future product candidates that may receive regulatory approval, on our own or together with collaborators
48% rewrittenRisks Related to Our Reliance on Third Parties
We rely on the Takeda License to provide us rights to develop and commercialize vonoprazan in the United States, Europe, and Canada. If the license agreement is terminated, we would lose our rights to develop and commercialize vonoprazan
41% rewrittenRisks Related to Our Intellectual Property
If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may not be able to successfully develop and commercialize the affected product candidates, which would have a material adverse effect on our business
39% rewrittenRisks Related to Our Business Operations and Industry
Our future growth and ability to compete depends on retaining our key personnel and recruiting additional qualified personnel
33% rewrittenRisks Related to Our Intellectual Property
Patent reform legislation could increase the uncertainties and costs surrounding the prosecution of our future patent applications or those of our current and future licensors and the enforcement or defense of our future issued patents or those of our current and future licensors
33% rewrittenRisks Related to Our Business Operations and Industry
We are subject to various foreign, federal, and state healthcare laws and regulations, and our failure to comply with these laws and regulations could result in significant fines, damages and penalties and harm our results of operations and financial condition
Was: We are subject to various foreign, federal, and state healthcare laws and regulations, and our failure to comply with these laws and regulations could harm our results of operations and financial condition
32% rewrittenRisks Related to Our Business Operations and Industry
Our Revenue Interest Financing Agreement could limit cash flow available for our operations and expose us to risks that could adversely affect our business, financial condition and results of operations
31% rewrittenRisks Related to Our Intellectual Property
Patent terms may be inadequate to protect our competitive position on VOQUEZNA and any future product candidates for an adequate amount of time
29% rewrittenRisks Related to Our Limited Operating History, Financial Position and Capital Requirements
unfavorable publicity relating to the product
21% rewrittenRisks Related to Our Common Stock
Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses
21% rewrittenRisks Related to Our Business Operations and Industry
Our employees and independent contractors, including consultants, vendor, principal investigators and CROs, may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
Was: Our employees and independent contractors, including principal investigators, CROs, consultants and vendors, may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
21% rewrittenRisks Related to Our Business Operations and Industry
Our internal information systems, or those of any of our CROs, contract manufacturers, service providers, other contractors or consultants or potential future collaborators, may fail or suffer cybersecurity incidents or breaches, which could result in a material disruption of our product development programs
20% rewrittenRisks Related to Our Business Operations and Industry
Enacted and future legislation and healthcare reform measures may increase the difficulty, cost and uncertainty for us of commercializing vonoprazan and any future product candidates and may adversely affect pricing, reimbursement and patient access
Was: Enacted and future legislation and healthcare reform measures may increase the difficulty and cost for us to commercialize vonoprazan and any future product candidates and may affect the prices we may set

All 92 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Limited Operating History, Financial Position and Capital Requirements

01Biopharmaceutical commercialization and product development both involve a substantial degree of riskNew
02We have incurred significant operating losses since inception and may never achieve or maintain profitability75% rewritten
03incur additional legal, accounting and other expenses in connection with operating as a public company68% rewritten
04We may require substantial additional financing to achieve our goals, finance our operations or meet our financial obligations, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could materially adversely affect our business73% rewritten
05Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates56% rewritten
06Agreement with Hercules contains minimum cash and performance financial covenants and our Revenue Interest Financing Agreement also contains minimum cash covenantsNew
07We currently rely entirely on the commercial success of our VOQUEZNA products, which depends upon the degree of market acceptance of such products by physicians, patients, healthcare payers and others in the medical community54% rewritten
08unfavorable publicity relating to the product29% rewritten
09We may lack the necessary expertise, personnel and resources to successfully commercialize VOQUEZNA, VOQUEZNA DUAL PAK, and VOQUEZNA TRIPLE PAK and any future product candidates that may receive regulatory approval, on our own or together with collaborators48% rewritten
10As a commercial-stage company with FDA-approved products, we are subject to ongoing regulatory obligations and failure to comply with these requirements or changes in regulatory rules could materially adversely affect our business or result in significant additional expenseNew
11injunctions or the imposition of civil or criminal penaltiesNew
12The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. If we are found or alleged to have improperly promoted off-label uses, we may become subject to significant liability58% rewritten
13monetary penalties, repayment obligations, and administrative dispute resolution proceedings. Legislative or regulatory changes could further expand the scope or obligations of the 340B programNew
14Competition in the markets for our approved products is expected to increase, and we may also face competition with respect to any product candidates we may develop, in each case which could materially adversely affect our business, results of operations and prospectsNew
15For the treatment of H. pylori infection, VOQUEZNA TRIPLE PAK and VOQUEZNA DUAL PAK compete primarily with generic PPI-based triple and quadruple therapies, as well as with branded therapies such as Talicia, a co-formulated capsule containing omeprazole, amoxicillin and rifabutin, marketed by RedHill Biopharma LtdNew
16If the market opportunities for our approved products, including VOQUEZNA, or for any future product candidates we may develop, are smaller than we expect, our business, results of operations and prospects could be adversely affectedNew
17If our efforts to develop, maintain and effectively deploy sales, marketing and distribution capabilities are unsuccessful, we may not be able to successfully commercialize our approved products or any product candidates we may develop and generate revenues at the levels and on the timing we expectNew
18Our future growth may depend, in part, on our ability to operate in foreign markets, particularly Europe and Canada, where we would be subject to additional regulatory burdens and other risks and uncertainties

Risks Related to the Development and Regulatory Approval of Product Candidates

19Our future growth depends on our ability to develop vonoprazan for additional indications or formulations and to successfully develop or acquire additional product candidatesNew
20obtaining and maintaining robust intellectual property protection or regulatory exclusivitiesNew
21Clinical development is lengthy, expensive and uncertain, and delays or failures in our clinical trials could limit our ability to obtain additional regulatory approvals and adversely affect our businessNew
22The conduct of clinical trials is subject to extensive regulation in the United States and other territories, and regulatory requirements and policies may change. New processes and requirements for the authorization and oversight of clinical trials may affect the planning, conduct, timing and cost of trialsNew
23Obtaining regulatory approval for product candidates, including additional indications or formulations of approved products, is subject to extensive regulation and is costly, time-consuming and uncertainNew
24such authorities may not accept a submission due to, among other reasons, the content or formatting of the submission59% rewritten
25clinical data needed for approval or encounter other issues such as unexpected side effects or formulation-related technical hurdles, and we may decide to pause or such development effortsNew
26If regulatory authorities do not accept data from our foreign clinical trials for future regulatory submissions, we may be required to conduct additional clinical trials, which would be costly and time consuming and could delay or prevent our development effortsNew
27diminished protection of intellectual property in some countriesNew
28Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations, government shutdowns or policy changes could delay regulatory review and approval processes and adversely affect our businessNew

Risks Related to Our Reliance on Third Parties

29We rely on the Takeda License to provide us rights to develop and commercialize vonoprazan in the United States, Europe, and Canada. If the license agreement is terminated, we would lose our rights to develop and commercialize vonoprazan48% rewritten
30timelines. Though we carefully manage our relationships with our CROs, investigators and other third parties, we may encounter challenges or delays in the future and these delays or challenges may have a material adverse impact on our business, financial condition and prospectsNew
31termination or nonrenewal of the agreement by the third party at a time that is costly or inconvenient for us85% rewritten
32Our reliance on third parties, including Sandoz, Catalent and Evonik, requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed
33The loss of, or significant reduction in business from, one or more of our major customers could significantly reduce our revenue, earnings or other operating results53% rewritten
34We may seek to enter into collaborations, licenses and other similar arrangements and may not be successful in doing so, and even if we are, we may not realize the benefits of such relationships53% rewritten

Risks Related to Our Business Operations and Industry

35Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or any guidance we may provide70% rewritten
36future accounting pronouncements or changes in our accounting policiesNew
37Our Revenue Interest Financing Agreement could limit cash flow available for our operations and expose us to risks that could adversely affect our business, financial condition and results of operations32% rewritten
38Our future growth and ability to compete depends on retaining our key personnel and recruiting additional qualified personnel39% rewritten
39We are subject to various foreign, federal, and state healthcare laws and regulations, and our failure to comply with these laws and regulations could result in significant fines, damages and penalties and harm our results of operations and financial condition33% rewritten
40Enacted and future legislation and healthcare reform measures may increase the difficulty, cost and uncertainty for us of commercializing vonoprazan and any future product candidates and may adversely affect pricing, reimbursement and patient access20% rewritten
41establishment of a Center for Medicare Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending53% rewritten
42reforms could reduce the ultimate demand for vonoprazan and any future product candidates, if approved, or put pressure on our product pricing, which could negatively affect our business, results of operations, financial condition and prospectsNew
43We and any of our third-party manufacturers or suppliers may use potent chemical agents and hazardous materials, and any claims relating to improper handling, storage or disposal of these materials could be time consuming or costly
44U.S. legislation, sanctions, trade restrictions and other foreign regulatory requirements could adversely impact the supply of material from foreign CROs and CMOs to us or our ability to secure government commitments to purchase potential therapies58% rewritten
45If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our products64% rewritten
46a decline in our stock price
47We and others are subject to ongoing adverse event reporting obligations for our approved products and any failure to comply with these requirements could result in regulatory action that would materially harm our businessNew
48expenditure and resources. Any failure or perceived failure to comply with the requirements of these laws could adversely affect our business, results of operations and financial conditionNew
49Our internal information systems, or those of any of our CROs, contract manufacturers, service providers, other contractors or consultants or potential future collaborators, may fail or suffer cybersecurity incidents or breaches, which could result in a material disruption of our product development programs21% rewritten
50Our business may be affected by the evolving regulatory framework for AI TechnologiesNew
51Our employees and independent contractors, including consultants, vendor, principal investigators and CROs, may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements21% rewritten
52We may engage in strategic transactions that could impact our liquidity, increase our expenses and present significant distractions to our management

Risks Related to Our Intellectual Property

53Our success depends on our ability to protect our intellectual property and our proprietary technologies
54countries other than the United States may have patent laws less favorable to patentees than those upheld by U.S. courts, allowing foreign competitors a better opportunity to create, develop and market competing products
55If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may not be able to successfully develop and commercialize the affected product candidates, which would have a material adverse effect on our business41% rewritten
56The patent protection and patent prosecution for vonoprazan or any future product candidates may be dependent on third parties
57Intellectual property rights do not necessarily address all potential threats to our competitive advantage
58Our commercial success depends significantly on our ability to operate without infringing the patents and other proprietary rights of third parties. Claims by third parties that we infringe their proprietary rights may result in liability for damages or prevent or delay our developmental and commercialization efforts
59Although no third party has asserted a claim of patent infringement against us as of the date of this annual report, others may hold proprietary rights that could prevent our VOQUEZNA products and any future product candidates from being marketed53% rewritten
60adverse determination in a judicial or administrative proceeding, or the failure to obtain necessary licenses, could prevent us from commercializing our VOQUEZNA products and any future product candidates, which could harm our business, financial condition and operating resultsNew
61We may not be successful in obtaining or maintaining necessary rights to our current products and any future product candidates through acquisitions and in-licenses
62Intellectual property litigation may lead to unfavorable publicity that harms our reputation and causes the market price of our common shares to decline
63Derivation or interference proceedings may be necessary to determine priority of inventions, and an unfavorable outcome may require us to cease using the related technology or to attempt to license rights from the prevailing party
64Patent reform legislation could increase the uncertainties and costs surrounding the prosecution of our future patent applications or those of our current and future licensors and the enforcement or defense of our future issued patents or those of our current and future licensors33% rewritten
65those of our current and future licensors and the enforcement or defense of our future issued patents or those of our current and future licensors, all of which could have a material adverse effect on our business, financial condition, results of operations and prospectsNew
66Changes in U.S. patent law, or laws in other countries, could diminish the value of patents in general, thereby impairing our ability to protect our current products and any future product candidates
67We may be subject to claims challenging the inventorship or ownership of our future patents, the patents of our current and future licensors, or other intellectual property
68Patent terms may be inadequate to protect our competitive position on VOQUEZNA and any future product candidates for an adequate amount of time31% rewritten
69If we do not obtain patent term extension for any future product candidates, our business may be materially harmed
70We may not be able to protect our intellectual property rights throughout our licensed territories
71Obtaining and maintaining our patent protection depends on compliance with various procedural, documentary, fee payment and other requirements imposed by regulations and governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
72If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
73We may be subject to claims that we have wrongfully hired an employee from a competitor or that we or our employees have wrongfully used or disclosed alleged confidential information or trade secrets of their former employers
74If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected
75Any collaboration arrangements that we have or may enter into in the future may not be successful, which could adversely affect our ability to develop and commercialize our products
76a collaborator’s sales and marketing activities or other operations may not be in compliance with applicable laws resulting in civil or criminal proceedings

Risks Related to Our Common Stock

77The trading price of the shares of our common stock has been, and is likely to continue to be, highly volatile, and purchasers of our common stock could incur substantial losses58% rewritten
78changes in accounting standards, policies, guidelines, interpretations or principles
79Our executive officers, directors and principal stockholders, if they choose to act together, have the ability to control or significantly influence all matters submitted to stockholders for approval. Furthermore, many of our current directors were appointed by our principal stockholders
80We do not currently intend to pay dividends on our common stock, and, consequently, your ability to achieve a return on your investment will depend on appreciation, if any, in the price of our common stock
81We have ceased to qualify as a smaller reporting company in 2026, and as a result we are subject to increased reporting, compliance and internal control requirements, which may increase our costs and strain management resourcesNew
82Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable and may lead to entrenchment of management
83Our ability to use net operating loss, or NOL, carryforwards and other tax attributes may be limited
84Changes in tax laws may materially adversely affect our financial condition, results of operations and cash flows
85Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses21% rewritten
86Our business may be adversely affected by epidemics, pandemics or other public health emergenciesNew
87our products, delaying regulatory reviews or inspections, constraining our workforce or that of our third-party manufacturers, CROs, suppliers or service providers, and impairing our ability to raise capital or access the financial markets on acceptable termsNew
88Our failure to meet the continued listing requirements of the Nasdaq could result in a delisting of our common stock
89We incur significant costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives
90If securities or industry analysts do not publish research or reports or publish unfavorable research or reports about our business, our stock price and trading volume could decline
91If we fail to maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline85% rewritten
92We could be subject to securities class action litigation

Other Phathom Pharmaceuticals 10-Ks

FY2024 10-K risk factors
89 risks
Phathom Pharmaceuticals faces significant financial risks driven by heavy reliance on vonoprazan products like VOQUEZNA, substantial operating losses, and a reliance on third-party manufacturers.
Filed Mar 06, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.