XOMA Corporation (Nasdaq: XOMA), the biotech royalty
aggregator, reported its fourth quarter and full year 2023
financial results and highlighted portfolio activities expected to
drive long-term shareholder value.
“Over the course of 2023, we continued to build the foundation
for future growth, spearheaded by the $140 million royalty-backed
financing of VABYSMO® in the fourth quarter,” stated Owen Hughes,
Chief Executive Officer of XOMA. “We entered 2024 with the
strongest cash position in the Company’s history, several key
upcoming clinical and regulatory events, including the potential
approvals of Day One’s tovorafenib and Zevra Therapeutics’
arimoclomol NDAs, and a growing pipeline of asset
opportunities.”
Key Fourth Quarter Events
Partner |
Event |
Day One Biopharmaceuticals |
- Tovorafenib NDA accepted by U.S. Food and Drug Administration
(FDA), resulting in XOMA’s receipt of a $5 million milestone
payment from Viracta
- Tovorafenib data presented at the Society of Neuro-Oncology
Annual Meeting and published in Nature Medicine
|
Zevra
Therapeutics |
Resubmitted the arimoclomol NDA
with FDA |
Medexus |
Pediatric label expansion application for IXINITY® accepted for
review by FDA |
Rezolute |
- Launched RZ358 Phase 3 study
- Received Priority Medicines (PRIME) eligibility from European
Medicines Agency
|
AstraZeneca |
Launched and dosed first patient in rilvegostomig Phase 3
study |
LG Chem (AVEO
Oncology) |
Launched ficlatuzumab Phase 3
study |
Organon |
Announced intent to terminate ebopiprant License Agreement |
Anticipated 2024 Events of Note
Partner |
Event |
Day One Biopharmaceuticals |
April 30, 2024 – FDA action date for tovorafenib NDA |
Zevra
Therapeutics |
September 21, 2024 – FDA action
date for arimoclomol NDA |
Medexus |
FDA decision regarding IXINITY® pediatric label expansion |
Financial ResultsXOMA recorded total revenues
of $1.8 million and $4.8 million for the fourth quarter and full
year of 2023, respectively. In 2023, XOMA recognized $2.5
million in milestone payments received from two partners, whereas
the Company reported revenues of $6.0 million in 2022, of which
$4.0 million were milestone payments received from four
partners.
General and administrative (“G&A”) expenses were $7.3
million for the fourth quarter and $25.6 million for the full year
of 2023. In the fourth quarter and full year of 2022, G&A
expenses were $7.6 million and $23.2 million, respectively.
The increase of $2.4 million between the two full-year periods was
primarily due to a $5.5 million increase in stock-based
compensation, partially offset by a $2.1 million decrease in
consulting and legal expenses, and a $0.9 million decrease in
salaries and related expenses.
In the fourth quarter of 2023, G&A expenses included $2.6
million in non-cash stock-based compensation expense, compared with
$1.0 million in the fourth quarter of 2022. For the full year
of 2023, G&A expenses included $9.1 million in non-cash
stock-based compensation, compared with $3.6 million for the full
year of 2022.
XOMA received cash payments of approximately $5.7 million from
royalties and milestone payments in the fourth quarter of 2023, as
compared to $0.8 million in the comparable period in 2022.
During the full year of 2023, the Company received cash payments of
approximately $15.5 million from royalties and milestone payments,
as compared to $7.2 million in 2022. XOMA’s net cash used in
operations during the fourth quarter of 2023 was $3.9 million and
$18.2 million for the full year, as compared with $3.9 million used
during the fourth quarter of 2022 and $12.9 million used for the
full year of 2022.
XOMA incurred one-time arbitration settlement costs of $4.1
million in 2023, related to an arbitration proceeding settlement
with one of its licensees.
For the year ended December 31, 2023, XOMA recorded $15.8
million in impairment charges, as a result of the discontinuation
of operations at Bioasis ($1.6 million) and Organon’s decision to
terminate its License Agreement for ebopiprant ($14.2
million).
Other income, net was $1.6 million for the full year of 2023 and
$0.3 million for the full year of 2022. The increase in other
income, net between periods is primarily due to an increase in
investment income.
In 2023, net loss for the fourth quarter and year ended December
31, 2023, was $20.1 million and $40.8 million, respectively.
In 2022, the net loss for the fourth quarter was $6.0 million and
$17.1 million for the full year.
On December 31, 2023, XOMA had cash and cash equivalents of
$159.6 million (including $6.3 million in restricted cash).
In 2023, XOMA’s royalty interests generated cash payments of
$7.3 million from Roche related to VABYSMO® sales and $1.7 million
from Medexus related to IXINITY® sales. The Company also
received a $5.0 million milestone payment from Viracta related to
the FDA’s acceptance of Day One Pharmaceuticals’ NDA for
tovorafenib. These cash receipts from royalty and milestone
acquisitions reduced XOMA’s short-term royalty and commercial
payment receivables by $14 million. On October 16, 2023, the
Company paid total cash dividends of $1.4 million on the 8.625%
Series A Cumulative Perpetual Preferred Stock (Nasdaq: XOMAP) and
on the 8.375% Series B Cumulative Perpetual Preferred Stock
(Nasdaq: XOMAO). In December 2023, XOMA drew $130.0 million
from its royalty-backed loan with certain funds managed by the
credit platform of Blue Owl Capital. On December 31, 2022,
the Company reported cash of $57.8 million. Based upon the
cash flows XOMA expects to receive from VABYSMO®, DSUVIA®, and
IXINITY® sales in addition to its current cash position, the
Company continues to believe its current cash position will be
sufficient to fund XOMA’s operations for multiple years.
Subsequent EventsOn January 2, 2024, the
Company announced a stock repurchase program of up to $50 million
through January 2027.
On January 7, 2024, Owen Hughes was appointed as Chief Executive
Officer and Jack Wyszomierski was named Chairman of the Board of
Directors.
On January 18, 2024, XOMA acquired an economic interest in
DSUVIA® (sufentanil sublingual tablet) from Talphera, Inc., for $8
million. DSUVIA® is commercialized by Alora
Pharmaceuticals. XOMA will receive 100 percent of all
royalties and milestones related to DSUVIA® sales until it receives
$20 million. Thereafter, XOMA will receive a 15 percent
royalty associated with DSUVIA® commercial sales, a 37.5 percent
royalty on DoD purchases and 50 percent of the remaining $116.5
million in potential milestone payments due from Alora
Pharmaceuticals.
On February 16, 2024, XOMA announced its intention to acquire
Kinnate Biopharma for between $2.3352 and $2.5879 in cash per share
plus a contingent value right (CVR). XOMA anticipates it will
add approximately $9.5 million to its cash balance at the closing
of the acquisition, which is expected to occur in April 2024.
About XOMA CorporationXOMA is a biotechnology
royalty aggregator playing a distinctive role in helping biotech
companies achieve their goal of improving human health. XOMA
acquires the potential future economics associated with
pre-commercial and commercial therapeutic candidates that have been
licensed to pharmaceutical or biotechnology companies. When
XOMA acquires the future economics, the seller receives
non-dilutive, non-recourse funding they can use to advance their
internal drug candidate(s) or for general corporate purposes.
The Company has an extensive and growing portfolio of assets (asset
defined as the right to receive potential future economics
associated with the advancement of an underlying therapeutic
candidate). For more information about the Company and its
portfolio, please visit www.xoma.com.
Forward-Looking Statements/Explanatory
NotesCertain statements contained in this press release
are forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, including statements regarding the timing and
amount of potential commercial payments to XOMA and other
developments related to VABYSMO® (faricimab-svoa), IXINITY®
[coagulation factor IX (recombinant)], DSUVIA® (sufentanil
sublingual tablet), tovorafenib, and arimoclomol; the potential
out-licensing of ebopiprant to an external partner for further
development; the anticipated timings of regulatory filings and
approvals related to assets in XOMA’s portfolio; the potential of
XOMA’s portfolio of partnered programs and licensed technologies
generating substantial milestone and royalty proceeds over time;
and XOMA’s cash sufficiency forecast. In some cases, you can
identify such forward-looking statements by terminology such as
“anticipate,” “intend,” “believe,” “estimate,” “plan,” “seek,”
“project,” “expect,” “may,” “will”, “would,” “could” or “should,”
the negative of these terms or similar expressions. These
forward-looking statements are not a guarantee
of XOMA’s performance, and you should not place undue
reliance on such statements. These statements are based on
assumptions that may not prove accurate, and actual results could
differ materially from those anticipated due to certain risks
inherent in the biotechnology industry, including those related to
the fact that our product candidates subject to out-license
agreements are still being developed, and our licensees may require
substantial funds to continue development which may not be
available; we do not know whether there will be, or will continue
to be, a viable market for the products in which we have an
ownership or royalty interest; if the therapeutic product
candidates to which we have a royalty interest do not receive
regulatory approval, our third-party licensees will not be able to
market them; and the impact to the global economy as a result of
the COVID-19 pandemic. Other potential risks to XOMA meeting
these expectations are described in more detail in XOMA's most
recent filing on Form 10-Q and in other filings with the Securities
and Exchange Commission. Consider such risks carefully when
considering XOMA's prospects. Any forward-looking statement
in this press release represents XOMA's beliefs and assumptions
only as of the date of this press release and should not be relied
upon as representing its views as of any subsequent date.
XOMA disclaims any obligation to update any forward-looking
statement, except as required by applicable law.
EXPLANATORY NOTE: Any references to “portfolio” in this press
release refer strictly to milestone and/or royalty rights
associated with a basket of drug products in development. Any
references to “assets” in this press release refer strictly to
milestone and/or royalty rights associated with individual drug
products in development.
As of the date of this press release, all assets in XOMA’s
milestone and royalty portfolio, except VABYSMO® (faricimab-svoa),
IXINITY® [coagulation factor IX (recombinant)], DSUVIA® (sufentanil
sublingual tablet), are investigational compounds. Efficacy
and safety have not been established. There is no guarantee
that any of the investigational compounds will become commercially
available.
XOMA
CORPORATION |
|
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
|
(in
thousands, except per share amounts) |
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
Revenues: |
|
|
|
|
Revenue from contracts with customers |
$ |
2,650 |
|
|
$ |
4,150 |
|
|
Revenue recognized under units-of-revenue
method |
|
2,108 |
|
|
|
1,877 |
|
|
Total
revenues |
|
4,758 |
|
|
|
6,027 |
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
Research and development |
|
143 |
|
|
|
153 |
|
|
General and administrative |
|
25,606 |
|
|
|
23,191 |
|
|
Impairment charges |
|
15,828 |
|
|
|
- |
|
|
Arbitration settlement costs |
|
4,132 |
|
|
|
- |
|
|
Amortization of intangible
assets |
|
897 |
|
|
|
97 |
|
|
Total
operating expenses |
|
46,606 |
|
|
|
23,441 |
|
|
|
|
|
|
|
Loss
from operations |
|
(41,848 |
) |
|
|
(17,414 |
) |
|
|
|
|
|
|
Other income
(expense) |
|
|
|
|
Interest expense |
|
(569 |
) |
|
|
- |
|
|
Other income (expense), net |
|
1,586 |
|
|
|
295 |
|
|
Loss
before income tax |
$ |
(40,831 |
) |
|
$ |
(17,119 |
) |
|
Income
tax benefit |
|
- |
|
|
|
15 |
|
|
Net loss and
comprehensive loss |
$ |
(40,831 |
) |
|
$ |
(17,104 |
) |
|
Net loss and
comprehensive loss attributable to common stockholders, basic and
diluted |
$ |
(46,303 |
) |
|
$ |
(22,576 |
) |
|
Basic and
diluted net loss per share attributable to common stockholders |
$ |
(4.04 |
) |
|
$ |
(1.98 |
) |
|
Weighted
average shares used in computing basic and diluted net loss per
share attributable to common stockholders |
|
11,471 |
|
|
|
11,413 |
|
|
|
|
|
|
|
XOMA
CORPORATION |
|
CONSOLIDATED
BALANCE SHEETS |
|
(in
thousands, except share and per share amounts) |
|
|
|
|
|
|
|
December
31, |
|
December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
ASSETS |
|
|
|
Current
assets: |
|
|
|
|
Cash and cash equivalents |
$ |
153,290 |
|
|
$ |
57,826 |
|
|
Short-term restricted cash |
|
160 |
|
|
|
- |
|
|
Short-term equity securities |
|
161 |
|
|
|
335 |
|
|
Trade and other receivables, net |
|
1,004 |
|
|
|
1 |
|
|
Short-term royalty and commercial payment receivables |
|
14,215 |
|
|
|
2,366 |
|
|
Prepaid expenses and other current assets |
|
483 |
|
|
|
725 |
|
|
Total current assets |
|
169,313 |
|
|
|
61,253 |
|
|
|
|
|
|
|
Long-term
restricted cash |
|
6,100 |
|
|
|
- |
|
|
Property and
equipment, net |
|
25 |
|
|
|
7 |
|
|
Operating
lease right-of-use assets |
|
378 |
|
|
|
29 |
|
|
Long-term
royalty and commercial payment receivables |
|
57,952 |
|
|
|
63,683 |
|
|
Intangible
assets, net |
|
- |
|
|
|
15,150 |
|
|
Other assets
- long term |
|
533 |
|
|
|
260 |
|
|
Total assets |
$ |
234,301 |
|
|
$ |
140,382 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
$ |
653 |
|
|
$ |
524 |
|
|
Accrued and other liabilities |
|
2,768 |
|
|
|
2,918 |
|
|
Contingent consideration under RPAs, AAAs and CPPAs |
|
7,000 |
|
|
|
75 |
|
|
Operating lease liabilities |
|
54 |
|
|
|
34 |
|
|
Unearned revenue recognized under units-of-revenue method |
|
2,113 |
|
|
|
1,899 |
|
|
Preferred stock dividend accrual |
|
1,368 |
|
|
|
1,368 |
|
|
Current portion of long-term debt |
|
5,543 |
|
|
|
- |
|
|
Total current liabilities |
|
19,499 |
|
|
|
6,818 |
|
|
|
|
|
|
|
Unearned
revenue recognized under units-of-revenue method – long-term |
|
7,228 |
|
|
|
9,550 |
|
|
Long-term
operating lease liabilities |
|
335 |
|
|
|
- |
|
|
Long-term
debt |
|
118,518 |
|
|
|
- |
|
|
Total liabilities |
|
145,580 |
|
|
|
16,368 |
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
Preferred Stock, $0.05 par value, 1,000,000 shares authorized: |
|
|
|
|
8.625% Series A cumulative, perpetual preferred stock, 984,000
shares issued and outstanding at December 31, 2023 and December 31,
2022 |
|
49 |
|
|
|
49 |
|
|
8.375% Series B cumulative, perpetual preferred stock, 1,600 shares
issued and outstanding at December 31, 2023 and December 31,
2022 |
|
— |
|
|
|
— |
|
|
Convertible preferred stock, 5,003 issued and outstanding at
December 31, 2023 and December 31, 2022 |
|
— |
|
|
|
— |
|
|
Common stock, $0.0075 par value, 277,333,332 shares authorized,
11,495,492 and 11,454,025 shares issued and outstanding at December
31, 2023 and December 31, 2022, respectively |
|
86 |
|
|
|
86 |
|
|
Additional paid-in capital |
|
1,311,809 |
|
|
|
1,306,271 |
|
|
Accumulated deficit |
|
(1,223,223 |
) |
|
|
(1,182,392 |
) |
|
Total stockholders’ equity |
|
88,721 |
|
|
|
124,014 |
|
|
Total liabilities and stockholders’ equity |
$ |
234,301 |
|
|
$ |
140,382 |
|
|
|
|
|
|
|
|
|
|
|
|
XOMA
CORPORATION |
CONSOLIDATED
STATEMENTS OF CASH FLOWS |
(in
thousands) |
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
Cash flows
from operating activities: |
|
|
|
|
|
Net loss |
$ |
(40,831 |
) |
|
$ |
(17,104 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
Stock-based compensation expense |
|
9,099 |
|
|
|
3,608 |
|
Impairment charges |
|
15,828 |
|
|
|
— |
|
Change in fair value of contingent consideration under RPAs, AAAs,
and CPPAs |
|
(75 |
) |
|
|
— |
|
Common stock contribution to 401(k) |
|
123 |
|
|
|
85 |
|
Amortization of intangible assets |
|
897 |
|
|
|
97 |
|
Depreciation |
|
3 |
|
|
|
7 |
|
Accretion of long-term debt |
|
34 |
|
|
|
— |
|
Non-cash lease expense |
|
119 |
|
|
|
170 |
|
Change in fair value of equity securities |
|
174 |
|
|
|
439 |
|
Changes in assets and liabilities: |
|
|
|
|
|
Trade and other receivables, net |
|
(1,003 |
) |
|
|
208 |
|
Prepaid expenses and other assets |
|
219 |
|
|
|
(71 |
) |
Accounts payable and accrued liabilities |
|
(523 |
) |
|
|
1,845 |
|
Income taxes payable |
|
— |
|
|
|
(91 |
) |
Operating lease liabilities |
|
(114 |
) |
|
|
(195 |
) |
Unearned revenue recognized under units-of-revenue method |
|
(2,108 |
) |
|
|
(1,877 |
) |
Net cash used in operating activities |
|
(18,158 |
) |
|
|
(12,879 |
) |
|
|
|
|
|
|
Cash flows
from investing activities: |
|
|
|
|
|
Payments of consideration under RPAs, AAAs and CPPAs |
|
(14,650 |
) |
|
|
(8,000 |
) |
Receipts under RPAs, AAAs and CPPAs |
|
13,956 |
|
|
|
3,026 |
|
Payment for IP acquired under the ObsEva IP Acquisition
Agreement |
|
— |
|
|
|
(15,247 |
) |
Purchase of property and equipment |
|
(17 |
) |
|
|
— |
|
Net cash used in investing activities |
|
(711 |
) |
|
|
(20,221 |
) |
|
|
|
|
|
|
Cash flows
from financing activities: |
|
|
|
|
|
Proceeds from issuance of long-term debt |
|
130,000 |
|
|
|
— |
|
Debt issuance costs and loan fees |
|
(4,253 |
) |
|
|
— |
|
Payment of preferred stock dividends |
|
(5,472 |
) |
|
|
(5,472 |
) |
Proceeds from exercise of options and other share-based
compensation |
|
466 |
|
|
|
2,419 |
|
Taxes paid related to net share settlement of equity awards |
|
(148 |
) |
|
|
(1,398 |
) |
Net cash provided by (used in) financing activities |
|
120,593 |
|
|
|
(4,451 |
) |
|
|
|
|
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash |
|
101,724 |
|
|
|
(37,551 |
) |
Cash, cash
equivalents at the beginning of the period |
|
57,826 |
|
|
|
95,377 |
|
Cash, cash
equivalents and restricted cash at the end of the period |
$ |
159,550 |
|
|
$ |
57,826 |
|
|
|
|
|
|
|
Supplemental
Cash Flow Information: |
|
|
|
|
Cash paid for taxes |
$ |
— |
|
|
$ |
76 |
|
Right-of-use assets obtained in exchange for operating lease
liabilities |
$ |
468 |
|
|
$ |
— |
|
Non-cash
investing and financing activities: |
|
|
|
|
Issuance of common stock warrants in connection with long-term
debt |
$ |
1,470 |
|
|
$ |
— |
|
Accrued issuance costs in connection with issuance of long-term
debt |
$ |
501 |
|
|
$ |
— |
|
Preferred stock dividend accrual |
$ |
1,368 |
|
|
$ |
1,368 |
|
Estimated fair value of contingent consideration under the LadRx
Agreements |
$ |
1,000 |
|
|
$ |
— |
|
Accrued transaction costs in connection with ObsEva IP
Acquisition |
$ |
— |
|
|
$ |
122 |
|
Accrual of contingent consideration under the Affitech CPPA |
$ |
6,000 |
|
|
$ |
— |
|
|
|
|
|
|
|
Investor contact:
Juliane
Snowden
XOMA +1-646-438-9754
juliane.snowden@xoma.com |
Media
contact:Kathy VincentKV Consulting &
Management+1-310-403-8951kathy@kathyvincent.com |
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