SEC Filing | Phathom Pharmaceuticals, Inc.

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10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q/A

(Amendment No. 1)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 001-39094

PHATHOM PHARMACEUTICALS, INC.

(Exact name of Registrant as specified in its charter)


Delaware		82-4151574
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

100 Campus Drive, Suite 102 Florham Park, New Jersey		07932
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (877) 742-8466

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common Stock, $0.0001 par value per share

PHAT

Nasdaq Global Select Market

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☑	Smaller reporting company	☑
Emerging growth company	☑

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of November 7, 2022, the registrant had 41,620,855 shares of common stock ($0.0001 par value) outstanding.

EXPLANATORY NOTE

This quarterly filing is amended to correct the date on the signature page.

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION

Item 1	Financial Statements (unaudited)	F-1
	Balance Sheets	F-1
	Statements of Operations and Comprehensive Loss	F-2
	Statements of Stockholders’ Equity (Deficit)	F-3
	Statements of Cash Flows	F-5
	Notes to Unaudited Financial Statements	F-6
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4	Controls and Procedures	33

PART II. OTHER INFORMATION

Item 1	Legal Proceedings	34
Item 1A	Risk Factors	34
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	35
Item 3	Defaults Upon Senior Securities	35
Item 4	Mine Safety Disclosures	35
Item 5	Other Information	35
Item 6	Exhibits	36
	Signatures	37

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

PHATHOM PHARMACEUTICALS, INC.

Balance Sheets

(Unaudited)

(in thousands, except share and par value amounts)


	September 30, 2022			December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	196,838		$	183,259
Prepaid expenses and other current assets		975			3,267
Total current assets		197,813			186,526
Property, plant and equipment, net		831			650
Operating lease right-of-use assets		2,482			1,914
Other long-term assets		805			341
Total assets	$	201,931		$	189,431

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable (including related party amounts of $80 and $1,343, respectively)		7,135			5,150
Accrued clinical trial expenses		139			1,402
Accrued expenses (including related party amounts of $2,383 and $2,330, respectively)		13,289			11,405
Accrued interest		686			477
Current portion of revenue interest financing liability		945			—
Operating lease liabilities, current		685			487
Total current liabilities		22,879			18,921

Long-term debt, net of discount		93,878			89,671
Revenue interest financing liability		102,850			—
Operating lease liabilities		1,247			1,183
Other long-term liabilities		7,500			7,500
Total liabilities		228,354			117,275

Commitments and contingencies (Note 4)

Stockholders’ equity:
Preferred stock, $0.0001 par value; authorized shares — 40,000,000; no shares issued and outstanding at September 30, 2022 and December 31, 2021		—			—
Common stock, $0.0001 par value; authorized shares — 400,000,000; issued shares — 41,620,874 and 31,656,035 at September 30, 2022 and December 31, 2021, respectively; outstanding shares — 41,143,826 and 30,511,226 at September 30, 2022 and December 31, 2021, respectively		3			3
Treasury stock — 19 and 1 at September 30, 2022 and December 31, 2021, respectively		—			—
Additional paid-in capital		645,620			601,523
Accumulated deficit		(672,046	)		(529,370	)
Total stockholders’ (deficit) equity		(26,423	)		72,156
Total liabilities and stockholders’ equity	$	201,931		$	189,431

See accompanying notes.

F-1

PHATHOM PHARMACEUTICALS, INC.

Statements of Operations and Comprehensive Loss

(Unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
Operating expenses:
Research and development (includes related party amounts of $77, $849, $1,800, and $2,695, respectively)	$19,020	$16,608	$55,495	$58,786
General and administrative (includes related party amounts of $0, $0, $0, and $16, respectively)	23,509	16,529	70,303	43,254
Total operating expenses	42,529	33,137	125,798	102,040

Loss from operations	(42,529)	(33,137)	(125,798)	(102,040)

Other income (expense):
Interest income	726	8	845	35
Interest expense	(9,277)	(1,485)	(17,703)	(4,013)
Other expense	(11)	(2,048)	(20)	(2,039)
Total other expense	(8,562)	(3,525)	(16,878)	(6,017)
Net loss and comprehensive loss	$(51,091)	$(36,662)	$(142,676)	$(108,057)
Net loss per share, basic and diluted	$(1.32)	$(0.98)	$(3.72)	$(2.94)
Weighted-average shares of common stock outstanding, basic and diluted	38,820,266	37,299,351	38,379,292	36,748,492

See accompanying notes.

F-2

PHATHOM PHARMACEUTICALS, INC.

Statements of Stockholders’ Equity (Deficit)

(Unaudited)

(in thousands, except share amounts)


	Common Stock				Treasury Stock		Additional Paid-in		Accumulated			Total Stockholders’
	Shares		Amount		Shares		Capital		Deficit			Equity
Balance at December 31, 2021		30,511,226	$	3		1	$	601,523	$	(529,370	)	$	72,156
Cashless exercise of common stock warrants		7,359,285		—		18		—		—			—
401(k) matching contribution		16,756		—		—		254		—			254
Vesting of restricted shares		222,595		—		—		—		—			—
Stock-based compensation		—		—		—		5,775		—			5,775
ESPP shares issued		39,951		—		—		515		—			515
Net loss		—		—				—		(40,665	)		(40,665	)
Balance at March 31, 2022		38,149,813	$	3		19	$	608,067	$	(570,035	)	$	38,035
Vesting of restricted shares		222,590		—		—		—		—			—
Stock-based compensation		—		—		—		5,885		—			5,885
Net loss		—		—		—		—		(50,920	)		(50,920	)
Balance at June 30, 2022		38,372,403	$	3		19	$	613,952	$	(620,955	)	$	(7,000	)
Issuance of common stock from exercise of stock options		—		—		—		—		—			—
401(k) matching contribution		84,784		—		—		862		—			862
Vesting of restricted shares		222,595		—		—		—		—			—
Issuance of common stock under ATM facility		2,414,897		—		—		24,596		—			24,596
Stock-based compensation		—		—		—		5,816		—			5,816
ESPP shares issued		49,147		—		—		394		—			394
Net loss		—		—		—		—		(51,091	)		(51,091	)
Balance at September 30, 2022		41,143,826	$	3		19	$	645,620	$	(672,046	)	$	(26,423	)

See accompanying notes.

F-3

PHATHOM PHARMACEUTICALS, INC.

Statements of Stockholders’ Equity (Deficit)

(Unaudited)

(in thousands, except share amounts)


	Common Stock				Treasury Stock		Additional Paid-in		Accumulated			Total Stockholders’
	Shares		Amount		Shares		Capital		Deficit			Equity
Balance at December 31, 2020		28,516,010	$	3		—	$	579,755	$	(385,487	)	$	194,271
Issuance of common stock from exercise of stock options		36,998		—		—		412		—			412
401(k) matching contribution		8,356		—		—		323		—			323
Vesting of restricted shares		301,656		—		—		—		—			—
Stock-based compensation		—		—		—		3,818		—			3,818
ESPP shares issued		13,490		—		—		358		—			358
Net loss		—		—		—		—		(34,843	)		(34,843	)
Balance at March 31, 2021		28,876,510	$	3		—	$	584,666	$	(420,330	)	$	164,339
Issuance of common stock from exercise of stock options		8,000		—		—		104		—			104
Vesting of restricted shares		301,659		—		—		—		—			—
Stock-based compensation		—		—		—		4,237		—			4,237
Net loss		—		—		—		—		(36,552	)		(36,552	)
Balance at June 30, 2021		29,186,169	$	3		—	$	589,007	$	(456,882	)	$	132,128
Issuance of common stock from exercise of stock options		50,073		—		—		1,265		—			1,265
401(k) matching contribution		18,394		—		—		580		—			580
Vesting of restricted shares		776,045		—		—		—		—			—
Stock-based compensation		—		—		—		4,419		—			4,419
ESPP shares issued		16,747		—		—		461		—			461
'Issuance of warrants		—		—		—		1,290		—			1,290
Net loss		—		—		—		—		(36,662	)		(36,662	)
Balance at September 30, 2021		30,047,428	$	3		—	$	597,022	$	(493,544	)	$	103,481

See accompanying notes.