Company: PHAT
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0000950170-25-034183
Chunk: 295

Company: Phathom Pharmaceuticals, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1B
Chunk 295
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-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. While the Company believes that it has appropriate support for the positions taken on its tax returns, the Company regularly assesses the potential outcome of examinations by tax authorities in determining the adequacy of its provision for income taxes. The following table summarizes the activity related to the Company's gross unrecognized tax benefits (in thousands): 

        Years EndedDecember 31,

        2024

        2023

        Beginning balance
         
        $
        3,010

        $
        2,327

        Increases related to prior year tax positions

        —

        51

        Increases related to current year tax positions

        442

        632

        Ending balance
         
        $
        3,452

        $
        3,010

      As of December 31, 2024 and 2023, the Company has gross unrecognized tax benefits of $3.5 million and $3.0 million, respectively, none of which would affect the effective tax rate due to a full valuation allowance. The Company does not anticipate any significant changes in its unrecognized tax benefits over the next 12 months. The Company's policy is to recognize the interest expense and/or penalties related to income tax matters as a component of income tax expense. The Company has no accrual for interest or penalties on its balance sheet as of December 31, 2024 and 2023, and has not recognized interest and/or penalties in its statement of operations for the years ended December 31, 2024 and 2023.The Company is subject to taxation in the United States and various states. The Company is not currently under examination by any taxing authorities. Due to the carryover of tax attributes, the statute of limitations is currently open for tax years since inception.

10. Segment InformationThe Company's chief operating decision maker, or CODM, the Chief Executive Officer, manages the Company’s business activities as a single reportable segment. The segment derives its current revenues from the sale of VOQUEZNA products. Accordingly, the CODM uses net loss to measure segment profit or loss, allocate resources and assess performance. Further, the