Income Taxes (Tables)

12 Months Ended

Sep. 30, 2025

During the years ended September 30, 2025, 2024, and 2023, the Company recorded income tax benefit (expense) as follows:


	Years Ended September 30,
	2025			2024			2023
	(in thousands)
Current income tax benefit (expense):
Federal	$	1,772		$	1,936		$	(2,522	)
State		(112	)		(193	)		(299	)
Deferred income tax benefit (expense):
Federal		—			—			—
State		—			—			—
Income tax benefit (expense)	$	1,660		$	1,743		$	(2,821	)

A reconciliation of the U.S. federal statutory income tax rate to the Company’s effective tax rate is as follows:


	Years Ended September 30,
	2025				2024				2023
Federal statutory income tax rate		(21.0	)	%		(21.0	)	%		(21.0	)	%
State taxes, net of federal benefit		(2.6	)			(2.7	)			(2.7	)
Change in valuation allowance		17.8				10.6				36.6
Federal research and development tax credit		(4.9	)			(2.2	)			(4.6	)
Share-based compensation		8.6				5.0				2.2
State research and development tax credit		(1.5	)			(0.7	)			(0.9	)
Foreign derived intangible income		—				—				(7.0	)
Interest on net operating loss carryback claim		(1.9	)			(1.2	)			(0.8	)
Change in deferred tax rate		3.7				10.6				(0.1	)
Other		(0.2	)			0.1				0.5
Effective income tax rate		(2.0	)	%		(1.5	)	%		2.2		%

Changes in the valuation allowance for deferred tax assets during the years ended September 30, 2025, 2024, and 2023 are as follows:


	Years Ended September 30,
	2025			2024			2023
	(in thousands)
Valuation allowance, beginning of year	$	(127,244	)	$	(115,120	)	$	(67,726	)
Increase recorded to valuation allowance		(14,989	)		(12,124	)		(47,394	)
Valuation allowance, end of year	$	(142,233	)	$	(127,244	)	$	(115,120	)

Net deferred tax assets as of September 30, 2025 and 2024 consisted of the following:


	September 30,
	2025			2024
	(in thousands)
Deferred tax assets:
Capitalized research and development	$	58,675		$	49,921
Liability related to the sale of future royalties		29,787			36,200
Tax credit carryforwards		24,196			18,793
Share-based compensation		12,911			14,551
Operating lease liability		12,229			13,058
Net operating loss carryforward		14,782			7,274
Accrued compensation		1,209			1,387
Accrued expenses		288			50
Other temporary differences		140			161
Total deferred tax assets		154,217			141,395
Valuation allowance		(142,233	)		(127,244	)
Net deferred tax assets		11,984			14,151

Deferred tax liabilities:
Operating lease, right-of-use assets		(7,885	)		(8,627	)
Depreciation		(3,920	)		(4,362	)
Prepaid expenses		(170	)		(999	)
Unrealized gain		(9	)		(163	)
Total deferred tax liabilities		(11,984	)		(14,151	)
Net deferred income tax assets (liabilities)	$	—		$	—

A reconciliation of the beginning and ending amount of uncertain tax positions is summarized as follows:


	September 30,
	2025			2024
	(in thousands)
Beginning Balance	$	905		$	1,056
Additions based on tax positions for the current period		—			—
Reductions for tax positions due to lapse of statute of limitations		(13	)		(11	)
Additions (reductions) for tax positions of prior periods		—			(140	)
Ending Balance	$	892		$	905

ENANTA PHARMACEUTICALS INC 10-K