Company: WHWK
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001628280-25-015269
Chunk: 162

Company: Whitehawk Therapeutics, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1B
Chunk 162
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 matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Product Revenue Allowances for Chargebacks and Government Rebates

As described in Note 2 to the consolidated financial statements, revenue from product sales is recognized net of estimates for variable consideration consisting of chargebacks, government rebates, distribution fees, co-payment assistance, and product returns. This variable consideration is recorded in the same period that the related revenue is recognized and creates variability for the consideration that the Company expects to receive. Liabilities related to government rebates and chargebacks involve the use of assumptions and judgments that include consideration of historical claims experience and channel mix. 

We identified the estimate for the allowance for government rebates and chargebacks as a critical audit matter.  Auditing the estimate for the allowance for government rebates and chargebacks involved especially challenging auditor judgment due to the nature and extent of audit effort required to address these matters. 

The primary procedures we performed to address this critical audit matter included: 

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•Evaluating the reasonableness of management’s estimate of the allowance for government rebates and chargebacks by developing an independent estimate utilizing actual product sales and actual rebates and chargeback claims received. 

•Testing the completeness and accuracy of the historical rebate and chargeback claims received. 

/s/ BDO USA, P.C.

We have served as the Company's auditor since 2017.

San Diego, California

March 27, 2025

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WHITEHAWK THERAPEUTICS, INC.

Consolidated Balance Sheets

(in thousands, except share data and par value)

Year Ended December 31,20242023AssetsCurrent assets:Cash and cash equivalents$28,670 $62,888 Short-term investments18,567 45,957 Accounts receivable, net5,903 5,488 Inventory5,311 6,427 Prepaid expenses and other current assets2,836 3,826 Total current assets61,287 124,586