Company: ARWR
Filing Date: 2025-01-29
Form Type: ARS
Source: 0001628280-25-002866
Chunk: 124

Company: ARROWHEAD PHARMACEUTICALS, INC.
Filing Date: 2025-01-29
Form: ARS
Chunk 124
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. The increase was primarily due to an increase in R&D headcount that has occurred as the Company has expanded its pipeline of candidates, in addition to annual salary increases. Facilities-related expense includes lease costs for the Company’s research and development facilities in San Diego, California and in Madison and Verona, Wisconsin. These expenses increased $9.5 million, or 58%, for the year ended September 30, 2024 compared to the same period of 2023. The increase was primarily due to full-year expenses such as utilities and repair and maintenance charges associated with the new facilities in San Diego, California and Verona, Wisconsin Stock compensation expense, a non-cash expense, is based upon the valuation of stock options and restricted stock units granted to employees. Stock compensation expense decreased $0.7 million, or 2%, for the year ended September 30, 2024 compared to the same period of 2023. The decrease was primarily due to the cancellation of awards upon the departure of employees. Depreciation and amortization expense, a non-cash expense, relates to depreciation on building, lab equipment and leasehold improvements. Depreciation and amortization expense increased $5.8 million, or 53% for the year ended September 30, 2024 compared to the same period of 2023. The increase was primarily attributed to higher leasehold improvements due to completion of the development of the San Diego facility. Additionally, as of December 31, 2023, the Company completed the build out of one of its laboratory and office facilities in Verona, Wisconsin, and commenced depreciation. 68

The Company anticipates these R&D expenses to continue to increase as its pipeline of candidates grows and progresses to later phase clinical trials, in addition to inflationary pressure on goods and services and the labor market. General & Administrative Expenses The following table provides details of general and administrative expenses: (in thousands) Year Ended September 30, 2024 % of Expense Category Year Ended September 30, 2023 % of Expense Category Increase (Decrease) $ % Salaries $ 27,589 28 % $ 22,999 25 % $ 4,590 20 % Professional, outside services, and other 24,733 25 % 20,720 22 % 4,013 19 % Facilities related 4,116 4 % 3,415 4 % 701 21 % Total general & administrative expense, excluding non-cash expense $