XOMA Corporation (Nasdaq: XOMA), a biotech royalty aggregator
playing a distinctive role in helping biotech companies achieve
their goal of advancing novel therapeutic candidates aimed at
improving human health, reported its first quarter 2022 financial
results and provided a recent operations update.
“Our team’s ability to identify and acquire the economic
interests in potential therapeutic assets that have significant
potential has been further validated with two events in the first
months of 2022. First, since enacting of the milestone and
royalty monetization strategy, an asset in our royalty portfolio
became the first to achieve regulatory and commercialization
approvals, leading off with the FDA in January and Japan’s MHLW at
the end of the quarter. Second, we are encouraged by
Regeneron’s recently announced acquisition of Checkmate and
vidutolimod (CMP-001)1,” stated Jim Neal, Chairman and Chief
Executive Officer of XOMA. “We congratulate our partners on
their recent achievements.”
“Several other partners announced milestones in their
development programs. In January 2022, Rezolute dosed the
final patient with RZ358 in its Phase 2 congenital hyperinsulinism
(CHI) study, which triggered a $2 million milestone payment to
XOMA. We congratulate Rezolute on the RIZE Study data
presented at Pediatric Endocrine Society Annual Meeting, which took
place on May 12,3 and its $130 million registered direct offering
and private placement4. We are pleased Rezolute and its
shareholders are committed to moving RZ358 into Phase 3 clinical
development. Additionally, Janssen expanded its cetrelimab
clinical program to investigate the compound in patients with
chronic hepatitis B virus. Furthermore, Palobiofarma launched
a Phase 2 study with PBF-6880 in COPD patients. Each of these
advancements reflect the dedication and desire of the scientists
and clinicians to give patients and their families much needed
hope.”
Faricimab, Affitech, and Roche UpdateIn October
2021, XOMA acquired an economic interest Roche’s novel bispecific
antibody from Affitech SA. During the first quarter of 2022,
XOMA paid $5 million in milestones to Affitech based upon the
January 2022 commercialization approval from the U.S. Food and Drug
Administration (FDA)5. XOMA does not owe Affitech a milestone
based upon the Japan’s Ministry of Health, Labour and Welfare
(MHLW) commercialization approval6, which was granted in March
2022. On April 25, 2022, Roche reported first quarter 2022
financial results, which included initial faricimab sales7.
Financial ResultsXOMA recorded total revenues
of $3.1 million for the first quarter of 2022, compared with $0.4
million in the first quarter of 2021. The increase for the
three months ended March 31, 2022, as compared to the corresponding
period of 2021, was primarily due to the $2.0 million milestone
earned under the Company’s development and commercialization
agreement with Rezolute and a $0.8 million milestone earned under
the Takeda Collaboration Agreement.
Research and development (“R&D”) expenses were $56,000 and
$61,000, respectively, for the first quarters of 2022 and 2021.
General and administrative (“G&A”) expenses were $5.1
million for the first quarter of 2022, compared to $6.7 million for
the first quarter of 2021. The decrease of $1.6 million for
the three months ended March 31, 2022, as compared to the
corresponding period of 2021, was due primarily to a $1.9 million
decrease in stock-based compensation expense for stock options and
a $0.2 million decrease in consulting and deal costs, partially
offset by a $0.5 million increase in personnel related
expenses.
In the first quarter of 2022, G&A expenses included $1.0
million in non-cash stock-based compensation expense, compared with
$2.9 million in the first quarter of 2021. XOMA’s net cash used in
operations in the first quarter of 2022 was $1.0 million, as
compared with $0.9 million during the first quarter of
2021.
Other expense, net was $0.2 million for the first quarter of
2022, compared to other expense, net of $0.7 million in the
corresponding quarter of 2021. The fluctuation in other
(expense) income, net between the quarters ended March 31, 2022 and
2021, is primarily due to the change in the fair value of equity
securities XOMA holds in Rezolute, Inc.
Net loss for the first quarter of 2022 was $2.3 million,
compared to net loss of $7.4 million for the first quarter of
2021.
On March 31, 2022, XOMA had cash, cash equivalents and
restricted cash of $88.6 million. On January 18, 2022, the
Company paid cash dividends on the 8.625% Series A Cumulative
Perpetual Preferred Stock (Nasdaq: XOMAP) equal to $0.53906 per
share and cash dividends on the 8.375% Series B Cumulative
Perpetual Preferred Stock (Nasdaq: XOMAO) equal to $0.52344 per
depositary share. The Company ended December 31, 2021, with
cash and restricted cash of $95.4 million. After paying its
remaining debt obligations in the second quarter of 2021, XOMA has
no debt on its balance sheet. The Company continues to
believe its current cash position will be sufficient to fund XOMA’s
operations for multiple years.
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 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 with more than 70 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 faricimab, 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-K 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 faricimab, 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 |
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS |
(unaudited) |
(in
thousands, except per share amounts) |
|
|
|
|
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
Revenues: |
|
|
|
Revenue from contracts with customers |
$ |
2,750 |
|
|
$ |
19 |
|
Revenue recognized under units-of-revenue
method |
|
357 |
|
|
|
356 |
|
Total
revenues |
|
3,107 |
|
|
|
375 |
|
|
|
|
|
Operating
expenses: |
|
|
|
Research and development |
|
56 |
|
|
|
61 |
|
General and administrative |
|
5,116 |
|
|
|
6,741 |
|
Total
operating expenses |
|
5,172 |
|
|
|
6,802 |
|
|
|
|
|
Loss
from operations |
|
(2,065 |
) |
|
|
(6,427 |
) |
|
|
|
|
Other
(expense) income, net: |
|
|
|
Interest
expense |
|
- |
|
|
|
(289 |
) |
Other
(expense) income, net |
|
(215 |
) |
|
|
(657 |
) |
Net loss and
comprehensive loss |
$ |
(2,280 |
) |
|
$ |
(7,373 |
) |
Less: accumulated dividends on Series A and Series B preferred
stock |
$ |
(1,368 |
) |
|
$ |
(530 |
) |
Net loss
available to common stockholders, basic and diluted |
$ |
(3,648 |
) |
|
$ |
(7,903 |
) |
Basic and
diluted net loss per share available to common stockholders |
$ |
(0.32 |
) |
|
$ |
(0.70 |
) |
Weighted
average shares used in computing basic and diluted net loss per
share available to common stockholders |
|
11,330 |
|
|
|
11,240 |
|
|
|
|
|
XOMA
CORPORATION |
CONDENSED
CONSOLIDATED BALANCE SHEETS |
(unaudited) |
(in
thousands, except share and per share amounts) |
|
March
31, |
|
December 31, |
|
|
2022 |
|
|
|
2021 |
|
ASSETS |
|
|
|
Current
assets: |
|
|
|
Cash and cash equivalents |
$ |
87,796 |
|
|
$ |
93,328 |
|
Restricted cash |
|
837 |
|
|
|
2,049 |
|
Short-term equity securities |
|
547 |
|
|
|
774 |
|
Trade and other receivables, net |
|
25 |
|
|
|
209 |
|
Prepaid expenses and other current assets |
|
409 |
|
|
|
613 |
|
Total current assets |
|
89,614 |
|
|
|
96,973 |
|
Property and
equipment, net |
|
12 |
|
|
|
13 |
|
Operating
lease right-of-use assets |
|
158 |
|
|
|
200 |
|
Long-term
royalty and commercial payment receivables |
|
69,075 |
|
|
|
69,075 |
|
Other assets
- long term |
|
301 |
|
|
|
301 |
|
Total assets |
$ |
159,160 |
|
|
$ |
166,562 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts payable |
$ |
787 |
|
|
$ |
1,072 |
|
Accrued and other liabilities |
|
855 |
|
|
|
525 |
|
Income taxes payable |
|
- |
|
|
|
91 |
|
Contingent consideration under royalty purchase agreements and
commercial purchase payment agreements |
|
3,075 |
|
|
|
8,075 |
|
Operating lease liabilities |
|
182 |
|
|
|
195 |
|
Unearned revenue recognized under units-of-revenue method |
|
1,623 |
|
|
|
1,641 |
|
Preferred stock dividend accrual |
|
1,368 |
|
|
|
1,368 |
|
Total current liabilities |
|
7,890 |
|
|
|
12,967 |
|
Unearned
revenue recognized under units-of-revenue method – long-term |
|
11,346 |
|
|
|
11,685 |
|
Long-term
operating lease liabilities |
|
- |
|
|
|
34 |
|
Total liabilities |
|
19,236 |
|
|
|
24,686 |
|
|
|
|
|
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 March 31, 2022 and December 31,
2021 |
|
49 |
|
|
|
49 |
|
8.375% Series B cumulative, perpetual preferred stock, 1,600 shares
issued and outstanding at March 31, 2022 and December 31, 2021 |
|
— |
|
|
|
— |
|
Convertible preferred stock, 5,003 issued and outstanding at March
31, 2022 and December 31, 2021 |
|
— |
|
|
|
— |
|
Common stock, $0.0075 par value, 277,333,332 shares authorized,
11,409,935 and 11,315,263 shares issued and outstanding at March
31, 2022 and December 31, 2021, respectively |
|
86 |
|
|
|
85 |
|
Additional paid-in capital |
|
1,307,357 |
|
|
|
1,307,030 |
|
Accumulated deficit |
|
(1,167,568 |
) |
|
|
(1,165,288 |
) |
Total stockholders’ equity |
|
139,924 |
|
|
|
141,876 |
|
Total liabilities and stockholders’ equity |
$ |
159,160 |
|
|
$ |
166,562 |
|
|
|
|
|
|
|
|
|
Investor contacts: |
|
|
Juliane Snowden |
|
Justin Frantz |
XOMA |
|
Solebury Trout |
+1-646-438-9754 |
|
+1-937-441-9731 |
juliane.snowden@xoma.com |
|
jfrantz@soleburytrout.com |
|
|
|
Media contact: |
|
|
Kathy Vincent |
|
|
KV Consulting & Management |
|
|
+1-310-403-8951 |
|
|
kathy@kathyvincent.com |
|
|
_______________________ 1
https://investor.regeneron.com/news-releases/news-release-details/regeneron-acquire-checkmate-pharmaceuticals-and-its
2
https://ir.rezolutebio.com/news-events/press-releases/detail/299/rezolute-announces-positive-data-from-its-phase-2b-rize
3
https://ir.rezolutebio.com/news-events/ir-calendar/detail/2700/rezolute-call-to-discuss-data-presented-at-pediatric4
https://ir.rezolutebio.com/news-events/press-releases/detail/300/rezolute-inc-announces-aggregate-130-million-registered
5 https://www.roche.com/media/releases/med-cor-2022-01-31 6
https://www.roche.com/investors/updates/inv-update-2022-03-28 7
https://www.roche.com/media/releases/med-cor-2022-04-25
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