Phathom Pharmaceuticals (NASDAQ:PHAT) reported fourth-quarter and full-year 2025 results that management said came in at the “better end” of previously communicated guidance ranges, while also outlining a series of balance-sheet actions and issuing 2026 financial guidance tied to continued execution of a gastroenterology-focused commercial strategy.
2025 results: revenue growth and lower cash operating expenses
President and CEO Steven Basta said 2025 was a “transformational year” and highlighted that the company delivered on the plan it laid out earlier in the year, including “growing revenue and reducing expenses.” For full-year 2025, Phathom reported net revenues of $175.1 million, representing 217% year-over-year growth. Fourth-quarter net revenue was $57.6 million, which management said was in line with its pre-release estimate and represented 16% sequential quarterly growth.
On expenses, the company emphasized improved discipline and a materially changed operating profile. Cash operating expenses (excluding stock-based compensation) were $50.3 million in Q4, which was better than both the company’s “less than $55 million” target and its pre-announced $51 million–$53 million range. Full-year cash operating expenses were approximately $284 million, which Narula said was at the low end of the range provided on the Q3 call. The company also reported a fourth-quarter loss from operations excluding stock-based compensation of approximately $320,000, which Narula said was a 95% improvement compared to Q3.
Phathom’s net cash usage in Q4 was approximately $5 million, and the company ended 2025 with about $130 million in cash and cash equivalents.
Commercial update: VOQUEZNA prescription trends and GI focus
Basta said the company is seeing “clear signs that our GI strategy is working” and noted that, through February 13, more than 1.1 million total VOQUEZNA prescriptions had been filled for more than 230,000 patients. He framed the opportunity in the context of an estimated 65 million patients with gastroesophageal reflux and said about 40% experience inadequate symptom relief from proton pump inhibitors (PPIs).
In Q4, Phathom said about 273,000 prescriptions were filled, including 174,000 covered prescriptions (up 21% quarter-over-quarter and representing roughly 64% of Q4 prescriptions) and 99,000 cash-paid prescriptions. Management emphasized that covered prescription volume drives revenue, while cash-paid volume can improve physician perception of access and confidence in prescribing.
The company also discussed channel and access initiatives. In November, Phathom “turned on” a GoodRx offering, including a $199 cash-pay option intended for certain patients who cannot use copay support or face higher out-of-pocket costs. Basta said GoodRx volumes were “still relatively small” and a “very small percentage” of overall prescriptions. On BlinkRx, he said more than half of total prescriptions now go through the BlinkRx network and that roughly 36% of total prescriptions are BlinkRx-dispensed cash scripts, with the remainder routed through BlinkRx but ultimately covered and reflected in IQVIA retail numbers.
Capital structure actions: equity offering and term loan modification
Management devoted significant time to capital structure changes aimed at reducing interest expense and addressing potential covenant and repayment concerns. Narula said the company completed an oversubscribed equity offering in January that raised $130 million in gross proceeds, bringing cash “just north of $250 million” at the start of the year.
Phathom also announced a modification of its outstanding term facility. Narula said the company:
- Reduced remaining principal to $175 million outstanding
- Used approximately $56 million of cash to streamline the facility, including paying certain end-of-term fees and accrued paid-in-kind amounts
- Lowered the interest rate from 12% to 9.85%
- Extended maturity from December 2027 to February 2029
Partial monthly repayments are expected to begin in 2028, which Narula said should reduce both principal and interest expense. Following the modification, management said cash on hand was approximately $190 million.
Narula also discussed liquidity covenants, emphasizing that term debt and revenue interest financing covenants are “not additive,” and the company manages to whichever requirement is highest at a given time. He said the highest cash balance requirement between now and September 30, 2027 is expected to be approximately $130 million, tied to the revenue interest financing agreement covenant that becomes effective October 1, 2026. Management said it believes current cash and anticipated future cash generated from operations will be sufficient to satisfy obligations and covenants.
2026 guidance: revenue, expenses, profitability timing, and an accounting reclassification
Phathom issued 2026 guidance that Narula said reflects continued growth from its GI-focused strategy, while also incorporating an accounting classification change effective January 1. Under the change, certain third-party charges will be included in cost of goods sold instead of gross-to-net adjustments. Narula said the change is “mostly net neutral” to gross profit and does not affect underlying operations, but is expected to shift approximately $17 million–$20 million between line items in 2026.
For 2026, the company guided to:
- Net revenue: $320 million–$345 million (including the impact of the classification change)
- Gross-to-net discount: 55%–59%
- Gross margin: approximately 80%
- Cash operating expenses (excluding stock-based comp): $235 million–$255 million (a 14% decrease at the midpoint versus 2025)
On cadence, Narula said revenue is expected to follow a similar pattern to 2025, with approximately 40% in the first half and 60% in the second half, and with Q1 typically the “soft quarter” due to seasonality. Expenses are expected to be relatively stable quarterly but step up modestly from the Q4 2025 exit rate due to a nearly full-strength sales team, a new marketing initiative, and full-year costs for an EoE phase II trial.
Management reiterated expectations for operating profitability (excluding stock-based compensation) beginning in Q3 2026 and for the full year 2026, with cash flow positivity expected in 2027.
Q&A: adoption ladder, seasonality, Medicare, and future pipeline plans
In response to analyst questions, Basta said Phathom is seeing momentum in gastroenterology and is focused less on converting new GI writers and more on increasing “writing frequency” among physicians who have already tried VOQUEZNA. He described an “adoption ladder” framework and said the company has seen physicians move up categories over time, noting that the number of physicians in the upper categories has grown from “400 or 500” last summer to “well north of 2,000.” He also said that among top writers, the company is seeing average penetration “passing” 20% of their PPI volume converting to VOQUEZNA, adding that broader 20% conversion in GI would imply a significantly larger revenue opportunity.
On primary care spillover, Basta said he has not reviewed detailed referral-pattern analysis but that the company is seeing an uplift in primary care prescribing on a broad basis, even as most sales force effort is directed to GI. He said the company is focused on steady execution rather than modeling a specific “inflection point.”
Management also addressed first-quarter seasonality, noting patterns similar to last year with January and February lighter and an expectation of improvement in March as plan changes settle, sales force activity ramps following the National Sales Meeting, and patient access issues work through. Basta said winter storms have had some effect, and he noted that IQVIA reported numbers have shown greater underreporting versus internal numbers than historical norms, which the company believes it has identified and expects to resolve.
On Medicare coverage, Basta said the company is not anticipating a broad system-wide coverage decision, but is seeing incremental Medicare scripts covered through appeals processes or specific Part D plans as plans become more familiar with VOQUEZNA claims.
Finally, on longer-term strategy beyond VOQUEZNA, Basta said the only new indication being actively pursued is EoE. He said the company is evaluating other potential opportunities, including whether to pursue further development for as-needed use in PHALCON-NERD, but has not made a decision. He also said Phathom’s long-term plan is to build a GI company that can bring in additional assets, and that the company has begun business development discussions for products that could be commercial or in Phase II/III, with an eye toward launches before loss of exclusivity in 2033 or 2034.
About Phathom Pharmaceuticals (NASDAQ:PHAT)
Phathom Pharmaceuticals is a clinical‐stage biopharmaceutical company focused on developing and commercializing novel treatments for gastrointestinal (GI) diseases. The company’s core mission centers on addressing serious GI disorders by leveraging innovative mechanisms of action to improve patient outcomes. Phathom’s research and development efforts concentrate on conditions such as Helicobacter pylori infection, erosive esophagitis, gastroparesis and other functional GI disorders where significant unmet medical needs persist.
The company’s lead asset is vonoprazan, a potassium‐competitive acid blocker (P-CAB) licensed for use in the United States.
