Company: WHWK
Filing Date: 2025-01-31
Form Type: DEFM14A
Source: 0001193125-25-018470
Chunk: 262

Company: Whitehawk Therapeutics, Inc.
Filing Date: 2025-01-31
Form: DEFM14A
Chunk 262
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 dispensed to a patient. As we receive inventory reports from the SDs and SP and have the ability to control the amount of product that is sold to the SDs and SP, we estimate future potential product returns based on the on-hand channel inventory data and sell-through data obtained from the SDs and SP. In arriving at our estimate, we also consider historical product returns, the underlying product demand, and industry data specific 
 to the specialty pharmaceutical distribution industry.                                                                                                                                                                                                                                                                                                                                                                                                                   |

Operating Expenses Selling, General and Administrative Expenses Selling, general and administrative expenses consist primarily of salaries and related benefits, including share-based compensation, related to our executive, finance, business development, sales and marketing, and other corporate functions. Other general and administrative expenses include professional fees for legal, auditing, tax and business consulting services, insurance costs, intellectual property and patent costs, facility costs and travel costs. Research and Development Expenses Research and development expenses, which consist primarily of costs associated with our product research and development efforts, are expensed as incurred. Research and development expenses consist primarily of: (i) employee related costs, including salaries, benefits and share-based compensation expense for employees engaged in scientific research and development functions; (ii) third-party contract costs relating to research, formulation, manufacturing, nonclinical studies and clinical trial activities; (iii) external costs of outside consultants who assist with technology development, regulatory affairs, clinical development and quality assurance; (iv) payments made under our third-party licensing agreements; and (v) allocated facility-related costs. Costs for certain activities, such as manufacturing, nonclinical studies and clinical trials are generally recognized based on the evaluation of the progress of completion of specific tasks using information and data provided by our vendors and collaborators. Research and development activities are central to our business. We expect to decrease our investment in research and development as a result of our halt and subsequent wind-down of the PRECISION1 study following interim data results and the pause of our two Phase 2 trials of FYARRO in patients with EEC and NETs, respectively. As a result, we expect that our research and development expenses will decrease in the foreseeable future. Cost of Goods Sold Cost of goods sold consist primarily of royalties paid to BMS, costs incurred on sales of FYARRO and costs to manufacture and prepare the product for sales subsequent to the FDA approval in November 2021. Costs incurred prior to the FDA approval were expensed when incurred. - 185 -

Other Income (Expense), Net Other income, net consists of interest income earned on