Company: ARVN
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001628280-25-049527
Chunk: 115

Company: ARVINAS, INC.
Filing Date: 2025-11-05
Form: 10-Q
Item: Part I, Item 1
Chunk 115
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 30, 2024 and the Company’s overall effective tax rate of (1.3)% was the 

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Table o    f Contents

effect of equity compensation and the valuation allowance recorded against the full amount of its net deferred tax assets.For the nine months ended September 30, 2025, the Company recognized income tax expense of $0.1 million, resulting in an effective tax rate of (0.8)%, as compared to income tax expense of $1.0 million resulting in an effective tax rate of (0.6)% in the same period for 2024. The primary reconciling items between the federal statutory rate of 21.0% for the nine months ended September 30, 2025 and the Company’s overall effective tax rate of (0.8)% was the effect of equity compensation and the valuation allowance recorded against the full amount of its net deferred tax assets. The primary reconciling items between the federal statutory rate of 21.0% for the nine months ended September 30, 2024 and the Company’s overall effective tax rate of (0.6)% was the effect of equity compensation and the valuation allowance recorded against the full amount of its net deferred tax assets.A valuation allowance is established when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The realization of deferred tax assets depends on the generation of future taxable income during the period in which related temporary differences become deductible. The Company continues to establish a valuation allowance against the full amount of its net deferred tax assets since it is more likely than not that benefits will not be realized, including those benefits created in the current year. This assessment is based on the Company's historical cumulative losses, which provide strong objective evidence that cannot be overcome with projections of income, as well as the fact the Company expects continuing losses in the future. On July 4, 2025, the “One Big Beautiful Bill Act” (the “OBBB Act”) was enacted into law. The OBBB Act includes changes to U.S. tax law with multiple effective dates starting in 2025. These changes include provisions allowing accelerated tax deductions for qualified property and research expenditures. Although the Company does not expect the OBBB Act to have a material impact on its estimated annual effective tax rate in 2025, it continues to assess the impact of the OBBB Act on subsequent periods.

11. Loss Per Common Share 

Basic and diluted loss per common share was calculated as