Phathom Pharmaceuticals, Inc.

Good day, ladies and gentlemen. Hello, and welcome to Fathom Pharmaceuticals' second quarter 2026 earnings results call. At this time, all participants are in a listen-only mode. After the presentation, there will be a question-and-answer session. To ask a question at that time, you will need to press star 1-1 on your telephone keypad. Please be advised that today's call is being recorded. With that, I would like to turn the call over to Eric Chiarelli, Fathom's Head of Investor Relations. Please go ahead, sir.

Thank you, operator. Hello, everyone, and thank you for joining us this morning to discuss Fathom's second quarter 2026 results. This morning's presentation will include remarks from Steve Basta, our president and CEO, and Sandeep Narula, our chief financial and business officer. A couple of notes before we get started. Earlier this morning, we issued a press release detailing the results we'll be discussing during the call. A copy of that press release can be found in the news releases section of our corporate website. Further, the recording of today's webcast and the slides that we will be reviewing can also be found on our corporate website under the events and presentations section. Before we begin, let me remind you that we will be making a number of forward-looking statements throughout today's presentation. These forward-looking statements involve risks and uncertainties, many of which are beyond Fathom's control. Actual results may materially differ from the forward-looking statements, and any such risks may materially adversely affect our business, and results of operations, and the trading prices for Fathom's common stock. A discussion of these statements and risk factors is available on the current Safe Harbor slide, as well as in the risk factors section of our most recent Form 10-K and subsequent SEC filings. All forward-looking statements made on this call are based on the beliefs of Fathom as of this date, and Fathom disclaims any obligation to update these statements. Later in the call, we will be commenting on both GAAP and non-GAAP financial measures. Specifically, in the scope of this discussion, when we refer to cash operating expenses, please note we are referring to the non-GAAP form of this measure, which excludes non-cash stock-based compensation. As always, detailed reconciliations between our non-GAAP results and the most directly comparable GAAP measures are included in this morning's press release. With that, I will now turn the call over to Steve Basta, Batham's President and CEO, to kick us off.

Steve? Thank you, Eric. and thank you everyone for joining our call this morning. Let me start by highlighting the significant transition Fathom has made over the last year and a half. I'm very proud to share that for the first time in Fathom's history and ahead of our guidance, we generated positive operating profit in Q2, excluding stock-based compensation. That's a dramatic improvement compared to Q2 last year when our operating loss was more than $50 million. Importantly, from Q2 2025, To Q2 2026, we increased revenue by about 88% and reduced cash operating expenses by about 34%. We have executed a successful pivot in our operations. We are on a solid trajectory and expect meaningful long-term growth generated by our core strategy to focus first on gastroenterologists. We continue to believe we can reach $1 billion in annual potential revenue with this focus on GI prescribers and have the potential for a second billion in annual revenue through expanded engagement with primary care prescribers in future years. For full year 2026, we are updating our revenue outlook to $310 million to $325 million. This new revenue guidance range still indicates meaningful expected growth over the next two quarters. We are hearing from our field team and in our market research that physicians are encountering friction in the process of obtaining Voquesna for their GERD patients. While many physicians have demonstrated willingness to navigate the process to get Voquesna for their most severe GERD patients, some may be more hesitant to work through the perceived hurdles to prescribe Voquesna more broadly for their less severe GERD patients. This influenced the fine-tuning of our 2026 guidance range. That being said, we believe we can meaningfully improve this dynamic and we are working on several initiatives which we believe have the potential to reduce friction for physicians and patients and to support accelerated growth. We remain confident in our GI-first strategy and our long-term outlook for Vekwesna. I'd like to turn briefly to a few key financial highlights for the quarter and then Sanjeev will provide further commentary during his portion of the call. For Q2, We reported net revenues of $74.3 million, cash operating expenses excluding stock-based compensation of $56.4 million, and for the first time as a business, we generated cash from operations of about $1.6 million. While we do not project generating cash each quarter this year, we do anticipate being consistently profitable at the operating profit level in upcoming quarters, excluding stock-based compensation charges, as we've previously discussed. We are proud of our company's results this quarter. They demonstrate solid execution of our GA-first pivot over the last year. A few quick notes on our commercial metrics for Q2. Since launch through July 17th, nearly 1.7 million Vuquesna prescriptions have been filled. Of the approximately 325,000 prescriptions that were filled in Q2, about 209,000 were covered prescriptions, representing approximately 64% of the total, while about 116,000 were filled as cash pay. Compared to last quarter, this represents 24% growth in covered volume and 16% growth in cash volume. On a year-over-year basis, covered prescriptions grew about 79%, and total prescriptions grew about 88%. Shifting to our development efforts, we've made solid progress in our EOE Phase II study, which is the first large placebo-controlled trial of an acid suppression treatment for this indication. We completed enrollment in June, which was ahead of schedule, and we were expecting top-line data later this year in Q4 for the 12-week blinded treatment portion of that trial. We believe Vaquesna has the potential to fill an important unmet need for EOE patients. The EOE program may also provide a potential path to extend Vaquesna exclusivity by six months if the Phase II trial results are favorable, we receive a written request from the FDA to include pediatric patients in a potential Phase III trial, and we conduct that trial as agreed with FDA. I'm also pleased to announce that we will be continuing our clinical work investigating Vaquesna as a potential as-needed or on-demand treatment for non-erosive GERD. We plan to initiate the phase three trial for as-needed use in Q4 of this year. In 2022, Fathom reported a successful phase two trial for as-needed use of Vaquesna. In this trial, Vaquesna demonstrated faster and sustained relief of episodic heartburn as compared to placebo. Volquesna demonstrated superiority on the primary endpoint of complete relief at three hours and sustained relief for 24 hours. Many patients in the phase two trial reported complete heartburn resolution as early as one hour following treatment with Volquesna. There is a significant population of patients with non-erosive GERD who are on chronic daily acid suppression therapies and would prefer to use a product as needed when they experience heartburn episodes. If the phase three trial is successful, We believe a potential expansion of the Vaquesna label could meaningfully increase the commercial opportunity for Vaquesna and could strengthen our planned future expansion of call efforts on primary care physicians. If approved, an as-needed use of a potent GERD treatment with 24-hour durable benefit could also provide a distinctive value proposition in future direct-to-consumer advertising. Overall, we remain confident in our outlook for Vaquesna and in our ability to execute efficiently. I'll now turn the call over to Sanjeev to take you through our financial updates.