To address missing heritability issue, many statistical methods for pathway-based analyses using rare variants have been proposed to analyze pathways individually. However, neglecting correlations between multiple pathways can result in misleading solutions, and pathway-based analyses of large-scale genetic datasets require massive computational burden. We propose a Pathway-based approach using HierArchical components of collapsed RAre variants Of High-throughput sequencing data (PHARAOH) for the analysis of rare variants by constructing a single hierarchical model that consists of collapsed gene-level summaries and pathways and analyzes entire pathways simultaneously by imposing ridge-type penalties on both gene and pathway coefficient estimates, hence our method considers the correlation of pathways without constraint by a multiple testing problem.