MONROVIA, Calif., Aug. 7, 2017 /PRNewswire/ -- Xencor, Inc.
(NASDAQ:XNCR), a clinical-stage biopharmaceutical company
developing engineered monoclonal antibodies for the treatment of
autoimmune disease, asthma and allergic diseases, and cancer, today
reported financial results for the second quarter ended
June 30, 2017 and provided a review
of business and clinical highlights.
"In the second quarter, we continued to advance our pipeline of
wholly-owned and partnered XmAb® antibody drug candidates," said
Bassil Dahiyat, Ph.D., president and
chief executive officer of Xencor. "In June, we announced
encouraging interim data from our ongoing Phase 2 study of
XmAb®5871 in IgG4-Related Diseases (IgG4-RD), and our partner,
MorphoSys, announced the initiation of a pivotal Phase 3 trial with
XmAb®5574/MOR208, the third XmAb asset to enter Phase 3
development. Still ahead in 2017, we expect topline results from
our Phase 2 study of XmAb5871 in IgG4-RD and our Phase 1
subcutaneous administration study of XmAb®7195, and preclinical
data from our bispecific oncology candidates targeting the tumor
microenvironment. Looking at our internal portfolio more broadly,
by the end of 2018 we expect to have proof-of-concept data from our
four lead programs, including our first bispecific programs,
XmAb®14045 and XmAb®13676, and to advance additional bispecific
oncology antibodies into clinical testing."
Recent Business Highlights and Anticipated Upcoming
Milestones
XmAb5871: XmAb5871 is a first-in-class monoclonal
antibody that targets CD19 with its variable domain, and uses
Xencor's XmAb immune inhibitor Fc domain to target FcyRIIb, a
receptor that inhibits B-cell function. XmAb5871 is currently in
Phase 2 clinical studies for the treatment of IgG4-RD and systemic
lupus erythematosus (SLE).
- Topline data from IgG4-RD Phase 2 trial expected in 2017
- Initial data from SLE Phase 2 trial expected in late 2018/early
2019
At the Annual European Congress of Rheumatology (EULAR 2017) in
June, Xencor presented interim data from its ongoing Phase 2
clinical study of XmAb5871 in IgG4-RD. As of the April 18, 2017 data cutoff, 14 of 15 treated
patients (93%) achieved a response to therapy of greater than or
equal to a three-point reduction in the IgG4-RD Responder Index
(IgG4-RD RI), including 12 patients (80%) who achieved a response
to therapy within two weeks of their first dose. Six patients
achieved disease remission (an IgG4-RD RI of 0) during the study.
XmAb5871 continues to be well-tolerated, with all XmAb5871-related
adverse event (AEs) graded as mild or moderate and no
XmAb5871-related serious AEs reported.
In May, XmAb5871 was granted orphan drug designation by the U.S.
Food and Drug Administration (FDA) for the treatment of IgG4-RD.
This designation qualifies Xencor for certain development
incentives, including tax credits for qualified clinical testing,
prescription drug user fee expansions and seven-year marketing
exclusivity upon FDA approval. Xencor plans to engage with the FDA
in 2017 to discuss future development plans for XmAb5871, including
clinical trial design and potential registration requirements.
XmAb7195: XmAb7195 is a first-in-class monoclonal
antibody that targets IgE with its variable domain and uses
Xencor's XmAb immune inhibitor Fc domain to target FcyRIIb,
resulting in three distinct mechanisms of action for reducing IgE
levels. A subcutaneously administered formulation of XmAb7195 is
currently in a Phase 1b study for the treatment of allergic
disease.
- Topline data from subcutaneous administration Phase 1b trial
expected in 2017
Bispecific Oncology Pipeline: Xencor's initial
bispecific antibody programs are tumor-targeted antibodies that
contain both a tumor antigen binding domain and a cytotoxic T-cell
binding domain (CD3). These bispecific antibodies activate T cells
for highly potent and targeted killing of malignant cells. Their
XmAb Fc domains confer long circulating half-lives, stability and
ease of manufacture. XmAb14045 is currently in a Phase 1 study for
the treatment of acute myeloid leukemia (AML) and other
CD123-expressing hematologic malignancies, and XmAb13676 is
currently in a Phase 1 study for the treatment of B-cell
malignancies.
- Initial data from XmAb14045 Phase 1 trial expected in 2018,
pending alignment on timing with Novartis
- Initial data from XmAb13676 Phase 1 trial expected in 2018,
pending alignment on timing with Novartis
- Investigational New Drug (IND) application filing for
XmAb®18087, a somatostatin receptor 2 (SSTR2) x CD3 bispecific
antibody for the treatment of neuroendocrine tumors, expected in
2017
- IND application filing for XmAb®20717, a PD-1 x CTLA-4 dual
checkpoint inhibitor for the treatment of multiple oncology
indications, expected in 2018
Partnered XmAb Programs: Nine pharmaceutical companies
and the National Institutes of Health are advancing novel drug
candidates either discovered at Xencor or that rely on Xencor's
proprietary XmAb technology. Seven such programs are currently
undergoing clinical testing, including three in Phase 3
studies.
- In June 2017, MorphoSys AG
announced the initiation of the pivotal Phase 3 portion of its
Phase 2/3 clinical trial of XmAb5574/MOR208 in combination with
bendamustine for the treatment of relapsed or refractory large
B-cell lymphoma (B-MIND trial). MOR208 uses Xencor's XmAb Cytotoxic
Fc Domain. The trial initiation triggered a milestone payment to
Xencor of $12.5
million.
Corporate:
- In June 2017, Xencor announced
the appointment of Raphael Clynes,
M.D., Ph.D., as vice president of translational biology. In this
newly-created role, Dr. Clynes will focus on understanding the
biological mechanisms of XmAb antibody drug candidates,
particularly in immuno-oncology.
Second Quarter Ended June 30,
2017 Financial Results:
Cash, cash equivalents and marketable securities totaled
$378.7 million as of June 30, 2017, compared to $403.5 million on December
31, 2016. The decrease reflects net spending on operations
in the six months ended June 30,
2017.
Revenues for the second quarter ended June 30, 2017 were $13.3
million, compared to $66.0
million for the same period in 2016. Revenues for the six
months ended June 30, 2017 were
$17.7 million, compared to
$73.3 million for the same period in
2016. Revenues in the three and six-month period ended June 30, 2017 were primarily milestones received
from the Company's CSL and MorphoSys collaborations, compared to
revenues for the same period in 2016, which were earned primarily
from the Company's Novartis and Amgen collaborations.
Research and development expenditures for the second quarter
ended June 30, 2017 were $16.9 million, compared to $14.4 million for the same period in 2016. Total
research and development expenses for the six-month period ended
June 30, 2017 were $32.0 million, compared to $24.4 million for the same period in 2016. The
increased research and development spending for the three and six
months ended June 30, 2017 is
primarily due to additional spending on Xencor's pipeline of
bispecific oncology candidates.
General and administrative expenses for the second quarter ended
June 30, 2017 were $4.1 million, compared to $3.0 million in the same period in 2016. Total
general and administrative expenses for the six-month period ended
June 30, 2017 were $8.9 million, compared to $7.0 million for the same period in 2016.
Increased spending on general and administrative for the three and
six months ended June 30, 2017
reflects increased charges for stock based compensation.
Non-cash, share based compensation expense for the six months
ended June 30, 2017 was $6.6 million, compared to $4.0 million for the same period in 2016.
Net loss for the second quarter ended June 30, 2016 was $6.9
million, or $(0.15) on a fully
diluted per share basis, compared to a net income of $47.2 million, or $1.13 on a fully diluted per share basis, for the
same period in 2016. For the six months ended June 30, 2017, net loss was $21.5 million, or $(0.46) on a fully diluted per share basis,
compared to a net income of $40.8
million, or $0.98 on a fully
diluted per share basis, for the same period in 2016. The loss
reported for the three and six months ended June 30, 2017 compared to income for the same
periods in 2016 is primarily due to milestone revenue received from
CSL and MorphoSys in 2017 compared to revenue recognized under
Xencor's Novartis and Amgen collaborations in 2016.
The total shares outstanding was 46,854,762 as of June 30, 2017, compared to 40,944,080 as of
June 30, 2016. The increase in total
shares at June 30, 2017 reflects the
sale of shares in the December 2016
financing.
Financial Guidance:
Based on current operating plans, Xencor expects to have cash to
fund research and development programs and operations beyond 2020.
Xencor expects to end 2017 with approximately $340 million in cash, cash equivalents and
marketable securities.
Conference Call and Webcast:
Xencor will host a conference call today at 4:30 p.m. ET (1:30 p.m.
PT) to discuss these second quarter 2017 financial results
and provide a corporate update.
The live call may be accessed by dialing (877) 359-9508 for
domestic callers or (224) 357-2393 for international callers, and
referencing conference ID number: 55777665. A live webcast of the
conference call will be available online from the investor
relations section of the company's website at www.xencor.com. The
webcast will be archived on the company's website for 30 days.
About Xencor, Inc.:
Xencor is a clinical-stage
biopharmaceutical company developing engineered monoclonal
antibodies for the treatment of autoimmune diseases, asthma and
allergic diseases and cancer. Currently, 11 candidates engineered
with Xencor's XmAb® technology are in clinical
development internally and with
partners. Xencor's internal programs include: XmAb®5871
in Phase 2 development for the treatment of IgG4-Related Disease,
and also for the treatment of Systemic Lupus Erythematosus;
XmAb®7195 in Phase 1 development for the treatment of asthma and
allergic diseases; XmAb®14045 in Phase 1 development for acute
myeloid leukemia; XmAb®13676 in Phase 1 development for B-cell
malignancies; XmAb®18087 in pre-clinical development for the
treatment of neuroendocrine tumors; and XmAb®20717 in pre-clinical
development for the treatment of multiple
cancers. Xencor's XmAb antibody engineering technology
enables small changes to the structure of monoclonal antibodies
resulting in new mechanisms of therapeutic action. Xencor
partners include Novartis, Amgen, MorphoSys, Merck, CSL/Janssen,
Alexion and Boehringer Ingelheim. For more information, please
visit www.xencor.com.
Forward Looking Statements:
Statements contained in
this press release regarding matters that are not historical facts
are forward-looking statements within the meaning of applicable
securities laws, including the quotation from Xencor's President
and CEO, and statements related to expectations relating to
Xencor's financial expectations and business, the timing and future
results of Xencor's research and development programs, including
XmAb®5871, XmAb®7195 and bispecific programs, including XmAb®14045,
XmAb®13676, XmAb®20717 and XmAb®18087, Xencor's potential
partnering efforts or Xencor's capital requirements. Such
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results, performance or achievements
and the timing of events to be materially different from those
implied by such statements, and therefore these statements should
not be read as guarantees of future performance or results. Such
risks include, without limitation, the risks associated with the
process of discovering, developing, manufacturing and
commercializing drugs that are safe and effective for use as human
therapeutics and other risks described in Xencor's public
securities filings, including without limitation Xencor's Annual
Report on Form 10-K for the year ended December 31, 2016. All forward-looking statements
are based on Xencor's current information and belief as well as
assumptions made by Xencor. Readers are cautioned not to place
undue reliance on such statements and Xencor disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Xencor,
Inc.
|
Condensed Balance
Sheets
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2017
|
|
2016
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
$
11,220
|
|
$
14,528
|
|
Short-term marketable
securities
|
177,269
|
|
115,608
|
|
Accounts
receivable
|
14,876
|
|
8,616
|
|
Prepaid expenses and
other current assets
|
7,617
|
|
2,901
|
|
|
210,982
|
|
141,653
|
|
|
|
|
|
|
Property and
equipment, net
|
3,861
|
|
3,105
|
|
Long-term marketable
securities
|
190,242
|
|
273,340
|
|
Intangible assets,
net
|
10,865
|
|
10,362
|
|
Other
assets
|
214
|
|
103
|
|
|
$
416,164
|
|
$
428,563
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts payable and
accrued liabilities
|
$
11,363
|
|
$
10,700
|
|
Current portion of
deferred revenue
|
95,613
|
|
95,521
|
|
Income
taxes
|
455
|
|
65
|
|
|
107,431
|
|
106,286
|
|
|
|
|
|
|
Deferred rent, less
current portion
|
614
|
|
397
|
|
Deferred revenue,
less current portion
|
6,754
|
|
7,926
|
|
|
114,799
|
|
114,609
|
|
|
|
|
|
|
|
301,365
|
|
313,954
|
|
|
|
|
|
|
|
$
416,164
|
|
$
428,563
|
|
The 2016 balance
sheet was derived from the 2016 annual financial statements
included in the form 10-K that was filed on March 1,
2017.
|
Xencor,
Inc.
|
Condensed
Statements of Comprehensive Income (Loss)
|
(in thousands,
expect share and per share data)
|
|
|
|
|
|
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$13,340
|
|
$66,007
|
|
$17,681
|
|
$73,259
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
16,919
|
|
14,408
|
|
31,967
|
|
24,443
|
|
General and
administrative
|
4,091
|
|
3,043
|
|
8,903
|
|
6,993
|
Total operating
expenses
|
21,010
|
|
17,451
|
|
40,870
|
|
31,436
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
(7,670)
|
|
48,556
|
|
(23,189)
|
|
41,823
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
1,065
|
|
358
|
|
2,120
|
|
693
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income tax expense
|
(6,605)
|
|
48,914
|
|
(21,069)
|
|
42,516
|
|
Income tax
expense
|
280
|
|
1,749
|
|
450
|
|
1,749
|
Net income
(loss)
|
(6,885)
|
|
47,165
|
|
(21,519)
|
|
40,767
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income (loss)
|
|
|
|
|
|
|
|
|
Net unrealized gain
(loss) on marketable securities
|
(44)
|
|
113
|
|
201
|
|
732
|
Comprehensive
income (loss)
|
$(6,929)
|
|
$47,278
|
|
$(21,318)
|
|
$41,499
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income
(loss) per common share
|
$(0.15)
|
|
$1.16
|
|
$(0.46)
|
|
$1.00
|
Diluted net income
(loss) per common share
|
$(0.15)
|
|
$1.13
|
|
$(0.46)
|
|
$0.98
|
Basic weighted
average number of common shares
|
46,767,759
|
|
40,800,586
|
|
46,683,744
|
|
40,703,688
|
Diluted weighted
average number of common shares
|
46,767,759
|
|
41,738,460
|
|
46,683,744
|
|
41,701,262
|
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SOURCE Xencor, Inc.