Good morning, everyone. Thank you for joining the 24th Annual Needham Healthcare Conference. My name is Joey Stringer, and I'm one of the biotech analysts at Needham and Company. It's my pleasure to introduce our next company, Phathom Pharmaceuticals. Joining us today from the company is President and CEO Steve Basta, Chief Financial Officer Molly Henderson, and Chief Commercial Officer Martin Gilligan. For those of you joining us on the webcast, if you would like to ask a question, please do so at any time. You can submit a question using the chat box feature at the bottom of your screen. Members of the Phathom team, thank you so much for joining us today. Thank you for the invitation to be here. Thank you. Steve, you just joined as CEO last week. Tell us how you view Phathom. What's your vision going forward, and what are the corporate strategy priorities? Phathom is extraordinarily well positioned with a molecule of VOQUEZNA, VOQUEZNA's already demonstrating significant traction and significant uptake because of the fundamental clinical benefits. First principles, let's go back to first principles in biotech. What's the most important thing is to produce a drug that actually produces meaningful clinical benefit and then to drive commercialization and drive uptake. We are so well positioned and so fortunate to have a drug that has fundamentally improved care for millions of patients or demonstrated that it can improve care for millions of patients. We're a few hundred thousand patients into the prescription history of the product just in our first year of the broader GERD launch. That's all driven by the clinical performance of the molecule. As a starting point, we start with this remarkably effective drug that improves care for patients who have significant unmet need. PPIs have been around for 25, 30 years, but there are a lot of patients who aren't getting enough benefit. We're well positioned to take advantage of that. Now, what we need to do going forward, my near-term priorities are obviously drive the continued revenue ramp, and we want to drive continued uptake of the adoption of the product among prescribers and among patients and increasing prescriber utilization patterns, make the market access process more efficient, and drive the company to profitability. As I think about how do we take this company going forward, the near-term priorities are on the sales ramp, on making access as easy as possible, and on getting the company to profitability. Now, the VOQUEZNA patent issue, it's been an overhang on the stock for the last several months. Can you just level set us where this issue stands right now, including the citizens' petition? Right. The key question is, do we have exclusivity through 2030 or through 2032? That difference is really being driven by a citizens' petition process that FDA asked us to undertake so that they could work through a public comments process and then make a more formalized decision around getting designation of VOQUEZNA as having protection for the full period through 2032. We think we've got really strong arguments for why the product does qualify for the designation and does qualify for the protection that was already afforded to the combination packs. We already have the 10-year exclusivity period on the combination packs that include the molecule. We just want to make sure that the Orange Book listing gets corrected for the molecule itself. We filed our citizens' petition in December. It's a six-month review process. We'll have a decision in June. Now, one of three things could happen in that decision. We could get a yes, in which case we win. We get exclusivity through 2032. We could get a no, in which case likely we would litigate it, but it depends on the nature of the response that we get from the FDA, their rationale for it, et cetera. We think that the arguments are so clear that we should, in fact, get this protection and get the extra runway. We could get some intermediate answer that the FDA requires some additional time for some other process, and then we'll gauge how we work with them based upon what feedback they provide us. Any one of those three possible answers could come in June. I realize that creates uncertainty for our investors. I wish I could give you more transparency, but we'll have a decision in the next three months or so, and then we'll be able to define how we move forward, or actually in the next two months. Have you had any recent interaction with FDA? This isn't a process where we have ongoing dialogue. We submitted our application, and then they're going through an internal process of assessing it. We don't have frequent dialogue with the FDA through this process. Outside of FDA, what types of interactions have you had or are having with key stakeholders surrounding this exclusivity issue, and what's been the feedback from those conversations? I think it's actually not helpful to do the blow-by-blow on every conversation we have. I realize that from an investor perspective, you'd love to get that, but I just don't think it's a useful process to say, "We talked to X person," or, "We talked to Y person." That's not so helpful. We're working through the process. I know it's tough to just sort of say, "Hey, wait for two months. We're going to get an answer." We are sort of working through our process. We're letting FDA work through their process. We're preparing for all three possible answers and getting all of our ducks in a row in that process. We'll have clarity for you in the next 60 days. I wish I could give you more clarity today. I just can't. I don't have a crystal ball on what their decision is going to be, and I can't give you the clarity on exactly what to expect in that process. I think the investor community knows pretty well what the variables are in this process. Yeah. Maybe a bigger picture question, just given some of the recent news. How do the recently announced layoffs at HHS and FDA impact Phathom's exclusivity issue? Has there been turnover, and could that potentially introduce any delays or things like that on this issue? Yeah. To our knowledge, we've not seen any turnover that specifically would impact the review process or the timeline or the nature of the review decision. Now, obviously, it's not just the turnover issues, but you've got a whole new management within HHS and within FDA that is going to be involved in that process. That team is in place and is able to actively look at this issue on the timeframe that we expect. Got it. Maybe another one, you mentioned the three possible scenarios of yes, no, and we need more time sort of situation. What would you say would be the potential timelines to resolution in each of these cases? I guess maybe I'll ask you to handicap what you think the likelihood of maybe each of those scenarios or the likelihood of each of those playing out. Yeah. Joey, if you'll grant me the latitude to respectfully pass, I'm just going to pass on trying to handicap it. I'm not going to give you a probability of A, B, or C. There are so many different scenarios in what that intermediate thing could be that I don't think it's productive for us to sort of guess at what the next step is. We'll know in early June what feedback we get. We think we've got strong arguments for why we're going to get a yes. The arguments are fundamentally meritorious regarding the positioning and the past QIDP designation of the combination. It's hard to give us exclusivity on the combination and then not give us exclusivity on one of the molecules that's a component of the combination. I think the logic sort of works in our favor, but there's no guarantee on what the outcome is going to be from FDA. We'll know soon enough, and then we'll have a conversation. For the CP decision, what are the mechanics around the announcement? How would you disclose this? Just maybe walk us through what you think will happen there. I've not had extensive conversations internally about exactly what the mechanism will be. I would expect when we hear the decision, we will announce it promptly, but I don't know if it's that day or the next day or exactly what the mechanics are. We'll figure it out as we get closer to that. Got it. Okay. You have applied for Hatch-Waxman Extension. Just so we are all on the same page here, can you reconcile the composition of matter expiration date from Orange Book, which I think is listed as August 2028, to your guidance of April 2030 in sort of an earliest case scenario? Presumably, this depends on getting that HWE. What gives you the confidence that the time you requested will be granted? I would defer to my colleagues on sort of what we've communicated in the past in that regard. Again, I'm just, and I'm not trying to sidestep the issue, but I'm one week into it, and it's not the area that I focused extensively on. Not having done lots of diligence on our Hatch-Waxman filing, I'm going to defer to Molly and Martin to go through that. Yes. We've signaled that we expect, as Steve said, to get extension through April 2030 for our composition of matter patent. That Hatch-Waxman Extension has been filed, and we would expect to hear within the next 12 months or so. At this point, we largely expect it to be perfunctory. We don't see any issues. It's a standard two-year request, so nothing out of the ordinary. Okay. Perfect. Getting into the launch here, you haven't guided for VOQUEZNA sales yet, but current sell-side consensus estimates for 2025, I think it's around $165 million. Is this number something that you still feel comfortable with? You've been pretty consistent in your guidance or your language on this. What gives you the confidence in this general number? Yeah, Joey, I'll take that, Joey. Yeah. You're right. We've been saying that we're comfortable with that number, and we continue to say that. What's really driving it is acceleration. That's what we're going to be focused on very much in 2025 in terms of new writers and increasing the TRxs. Great. The TRx, the track, the weekly data from IQVIA, I just want to kind of focus on some of the trends we've seen in the first quarter of 2025. Essentially, we saw a dip starting in late December of last year, and it kind of lasted through February of this year. The trajectory has generally since returned to sort of a more normal type of trajectory. Can you maybe walk us through what we're seeing there? What are the causes behind this? That'd be very helpful. Yeah. Everyone names it something differently. I think the common name is that Q1 seasonality. If you recall back during Q4, we were starting to communicate that we would expect, like every other branded product in the industry, we would be subject to the same effect that happens. What typically happens in Q1, and we saw it happen, is you see a lot of people changing plans. You see people changing to high deductible plans in large number, and then those deductibles even going higher. Patients are making choices whether they're going to get their doctor visit or their medication in January versus spreading it out throughout the year. You see a lot of churn in the marketplace. What we did follow is that for certain, the entire branded market was down during that same period. We were even following some other launches, and we saw the same thing. As you noted, and we had expected towards the latter half of Q1, we would start to see that come back. We are seeing starting to move back to that normal flow of claims that were happening earlier in Q4. Great. Where are you seeing the biggest growth in terms of writers of prescription for VOQUEZNA? Definitely primary care. I want to put a kind of a note or disclaimer on that. It's because we have a lot of GI writers already. As you would expect, GI writers, we always say, would be the first to adopt. When we entered with non-erosive, you started to see that acceleration of primary care physicians. On a weekly basis, PCPs are a larger new writer group, and they've passed cumulative total writers, GI and PCP. As we get new data every week, you see more and more primary care physicians coming on board. GIs remain critically important to us. We're watching their depth and utilization of more VOQUEZNA. As we see more primary care come on, obviously, they're a little bit further behind in terms of months in terms of their first experience. Just in general, what are the key factors that will be important to drive next leg growth for the VOQUEZNA launch? Yeah. I think we have the access in place. I know we have the access in place. We have greater than 80% coverage. The majority of that where we have contracts is for one step through a PPI. We are definitely in good position on the payer front. We entered the year strong with that. We also entered Q1, as we were just saying, in terms of that Q1 seasonality. Really, it's getting more physicians to prescribe, which we're seeing, as I just mentioned. Those that are prescribing to use more. We're hearing great results with VOQUEZNA, great patient experiences that are coming back to us. Listen, as with any branded product, although we have great access, the physician needs to do something besides just prescribe the product. We're making sure we're providing as much information and where we can direct them to support to make sure that any PAs that they might need, that they can successfully submit those, complete them, and fill them out on their own. You announced some additional DTC campaign. I guess how will the recent expansion of that affect OpEx trends and pathway to profitability? Yeah. We have built in those OpEx in the OpEx estimates, the DTC, the increased campaign, especially for the first half of 2025. If you remember, we signaled that Q1 and Q2 will be a little bit heavier as we launch this new campaign, which largely includes non-erosive. Remember, the last campaign was predominantly around erosive. You will see, hopefully, some increased commercials over the next several weeks. We will look and take a step back and look at ROIs and make sure we get the biggest bang for the buck based on those investment dollars. What about an ex-U.S. partnership? Obviously, the exclusivity issue is front and center here, but any discussions around that front? Have you had any recent discussions? What's been the general feedback there? Yeah. There continues to be interest. Certainly, there's an opportunity to leverage and monetize the asset in Europe. I think what we've signaled previously is because the price point would be so much lower than in the U.S., we just want to make sure that we're very strategic in how we approach that market. Given some of the recent discussions from the administration around reference pricing and pricing in Europe in general being so much lower than the U.S., we'd hate to cannibalize our own business in the future. We will continue to assess the landscape, continue to keep those discussions open, and make the decision when the time's right. Got it. Competitive landscape question here. There are a couple of P-CAB programs in development. Cinclus has one that's phase III ready. Sabela has one in erosive esophagitis and NERD. I think data are coming in 2025. There are several other ex-U.S. programs. I guess, can you assess the competitive threat from maybe those two U.S. programs and where you think Phathom is uniquely positioned here? Yeah, I'll take that. There is a lot of noise regarding P-CABs coming and announcement that they're going to do trials in the U.S. In reality, except for Sabela, which you noted, really no one's taken any action. Sabela, the product that you mentioned, is tegoprazan. They've been in clinical trials for quite some time. I think what they recently communicated is they expect to have approval at the end of 2026. We can anticipate that we've probably got potentially two more years or a little bit less before they actually enter, assuming maybe that falls into 2027. Right now, we're not seeing they haven't shared any of their data. There is nothing in the public domain, nor have they signaled any press releases or that there is any data release coming up. It's hard to assess the competitive threat when you know nothing other than the compound and what company it's with. There is also something to say that sometimes having competition raises the volume overall, but it's just too early to speculate on their compound without knowing what their data is, what their positioning is, etc. It's to be seen, and there's not a lineup of P-CABs coming. Okay. Makes sense. Any updates on a potential phase III on-demand trial? Are you still assessing whether you need to run this? How does the CP decision factor into this? Yeah, I think we are still assessing the on-demand trial and sort of more broadly, actually. Again, just first week on the job, still sort of in the midst of assessing the overall clinical development program. The CP discernment certainly does factor into it because it impacts runway and timeline and sort of how long do you have exclusivity. So how long do you have to get a return on investment regarding a new indication or a new claim set that you might be able to make, even if it's for the same population of patients? The on-demand study could impact both the Rx environment and the future OTC environment. There may be some advantage in one or the other. We're in the midst of that assessment. There are currently no plans imminently to do that trial. It's designed, and we know what it would look like, and we know what the timeline would be. What is the ROI to doing that trial? That's an ongoing evaluation. Right. Right. In terms of the you're also doing some ODT and OTC development efforts for VOQUEZNA. Can you outline those for us? I think that the ODT concept, the concept of something that dissolves faster and delivers the product faster, we already have a faster onset of effect advantage. An ODT product might actually accelerate that. It's hard to predict exactly what the magnitude of acceleration is, but certainly, that might even enhance that. It might match in with the on-demand concept, and it might match well with how we might want to position in the future regarding OTC. I think these are all interrelated, not independent decision variables. How do you want to think about the ODT development? How do you want to think about timing and into which trials you want to roll that out? How does that play in an RX prescribing environment versus in an OTC environment? That's a strategic assessment that we're going to need to do in the near future. We're sort of actively starting that process of evaluating how do the variables, the multiple different initiatives that we might have on the R&D pathways, both in terms of formulation development and in terms of clinical trials, interact in terms of optimizing economic value for our shareholders. I don't have an answer for you yet, but we're actively looking at that. I think it's the right set of questions to be asking. Got it. That makes sense. You're also looking at some label expansion opportunities for VOQUEZNA. You got it for phase II trial start in EOE in this, I believe it's second quarter of this year. I guess, what's the rationale for running this program from a patent runway perspective? If everything goes as planned, what's the earliest you could reach the market? Is there any possibility that the LOE would kind of limit the upside there? Yes, I actually think that those are all the right questions to be asking about that program as well. In the same way that we were talking about on-demand and what's the runway for exclusivity around a new indication, same issues apply to EOE. We are actively working on getting that trial started. Having just joined a week ago, I'm asking exactly the same question, which is, what's the timeline to approval? It's sort of four, five, six years to get to that indication. How much runway do we have at the end of that process to be able to capitalize on that relative to the amount that we're investing? We're in the midst of that evaluation right now before we make that sort of broader commitment to the full study. The plans are underway and have been in the works, and the team's doing a fabulous job getting the trial ready to go and getting ready to start it. I am asking exactly that question. We're in the midst of that assessment. Okay. Got it. Maybe just one more on EOE. How would you plan to position the drug in that indication? There are other drugs in development, some biologics that are approved. Where do you think vonoprazan could potentially make a difference? The opportunity really is to be first-line care in EOE. The opportunity is an oral drug that has the safety profile that our product has at a cost that is meaningfully less than the biologics ought to be first-line therapy. That is the big upside opportunity on the EOE program. I mean, the challenge is obviously the timeline and cost relative to how much runway we have. The big upside opportunity is this ought to be first-line care. If you can manage EOE with an oral product with this safety profile, with immediate pain reduction benefits, with immediate acid reduction benefits, then this ought to be an easily adopted first-line therapy before the biologics. Got it. Cash runway, what's your current cash position and runway expectations? Do you still feel comfortable in your guidance through cash flow positivity? Sure. We ended 2024 just shy of $300 million cash on hand. We've signaled that, yes, we believe that in connection with the debt availability under the funds availability on our debt facility that we have runway to cash flow positivity. I believe you still have some financing available through a term loan. Do you have any limitations to access this? What are those terms? Yeah, good question. The next two tranches, each of $50 million, are triggered based upon hitting certain revenue thresholds. That's based upon Q2 revenue thresholds. Since we just started the quarter, we'll get a better sense of how we're trending once we report our Q1 results. Okay. Great. Last question from us. I've touched on it before, but what's the path to sustainable profitability look like for Phathom? I think the path to sustainable profitability is driven largely by revenue growth and by vigilant observation of discipline around costs. If we can hold costs at a level that enables the revenue ramp to get there, it's not a hard formula. You generate a bit more revenue than you have for your operating costs, and you start to show even positive numbers. The incremental revenue growth drives enormous profitability. We are having exactly that conversation internally around, okay, what does this ramp look like? What does the cost level need to look like for us to get to profitability? That's an ongoing conversation that we're having around what our operating disciplines need to be in that process. Great. Thank you, Steve, Martin, and Molly for participating. It was an excellent discussion. Thanks, Joey. Perfect. Thanks, Joey. Thanks, Neil. Yeah. Thank you. Thanks, everyone, for joining us on the webcast. Have a good day and a good rest of the conference. Thank you.