XOMA Corporation (Nasdaq: XOMA) reported its third quarter 2021
financial results and provided a recent operations update.
“Our portfolio of potential milestone and royalty assets
continues to grow and advance in the clinic. In the third
quarter, we acquired an economic interest in Checkmate
Pharmaceuticals’ vidotulimod (CMP-001), and we were delighted to
learn Compugen’s licensee, AstraZeneca, had dosed the first patient
in a Phase 1/2 study with AZD2936, which triggered a $0.5 million
milestone payment to XOMA from Compugen. Last month, we
announced a significant transaction for XOMA, the purchase of
rights to a 0.5% commercial payment on faricimab, a
BLA-review-stage asset, for a $6 million upfront plus potential
future milestone payments to Affitech SA. Three assets in our
portfolio received special designations from the U.S. Food and Drug
Administration. Additionally, there was meaningful progress
amongst our portfolio as partners expanded their clinical
development programs,” stated Jim Neal, Chief Executive Officer of
XOMA.
“We have further strengthened XOMA’s team in the past few
months. Heather L. Franklin, President and Chief Executive
Officer of Blaze Bioscience, Inc., joined our Board of Directors
this summer. We were very pleased to attract two accomplished
talents: Joyce Chan joined as our Vice President, Scientific
Analysis, and Christopher Baldwin as our Vice President,
Legal. Joyce spent 16 years at Amgen, both as a scientist and
in business development, licensing, and alliance management.
Chris combines significant experience providing legal counsel with
entrepreneurial experience, both of which are important for XOMA’s
business operations and our lean operating structure.
“I am pleased with the progress both our team and our partners
have made in 2021, and we express our gratitude to all of the
patients who participate in our partners’ clinical trials,” Mr.
Neal concluded.
Financial ResultsXOMA recorded total revenues
of $0.9 million for the third quarter of 2021, compared with $0.6
million in the third quarter of 2020. The increase for the
three months ended September 30, 2021, as compared to the
corresponding period of 2020, was primarily due to a $0.5 million
milestone earned under our license agreement with Compugen Ltd.,
which was triggered by the dosing of the first patient in a Phase
1/2 study of AZD2936, a TIGIT/PD-1 bispecific antibody derived from
COM902, that is being developed by AstraZeneca.
Research and development expenses were $30,000 and $34,000,
respectively, for the third quarters of 2021 and 2020.
General and administrative (“G&A”) expenses were $4.3
million for the third quarter of 2021, compared to $3.2 million for
the third quarter of 2020. The increase of $1.1 million for
the three months ended September 30, 2021, as compared to the
corresponding period of 2020, was due primarily to a $0.5 million
increase in salaries and related expenses, a $0.3 million increase
in consulting costs, and $0.1 million increase in legal and
insurance costs.
In the third quarter of 2021, G&A expenses included $0.8
million in non-cash stock-based compensation expense, compared with
$0.7 million in the third quarter of 2020. The Company’s net
cash used in operations in the third quarter of 2021 was $3.1
million, as compared with $2.4 million during the third quarter of
2020.
In the third quarter of 2020, XOMA recorded $0.4 million in
interest expense. In June 2021, the Company repaid its
outstanding debt obligations to Silicon Valley Bank and Novartis in
full.
Net loss for the third quarter of 2021 was $4.4 million,
compared to net loss of $1.1 million for the third quarter of
2020.
On September 30, 2021, XOMA had cash of $68.8 million. The
Company ended December 31, 2020, with cash of $84.2 million.
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 unique 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 potential
of XOMA’s portfolio of partnered programs and licensed technologies
generating substantial milestone and royalty proceeds over time,
creating additional value for the stockholders, cash sufficiency
forecast, economic outlook, and potential impact of the COVID-19
pandemic. 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 SEC
filings. 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 are investigational
compounds. Efficacy and safety have not been
established. There is no guarantee that any of these assets
will become commercially available.
XOMA
CORPORATION |
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS |
|
(unaudited) |
|
(in
thousands, except per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
Revenues: |
|
|
|
|
|
|
|
|
Revenue from contracts with customers |
$ |
550 |
|
|
$ |
200 |
|
|
$ |
1,094 |
|
|
$ |
753 |
|
|
Revenue recognized under units-of-revenue method |
|
390 |
|
|
|
357 |
|
|
|
1,121 |
|
|
|
1,051 |
|
|
Total revenues |
|
940 |
|
|
|
557 |
|
|
|
2,215 |
|
|
|
1,804 |
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research and development |
|
30 |
|
|
|
34 |
|
|
|
129 |
|
|
|
134 |
|
|
General and administrative |
|
4,255 |
|
|
|
3,212 |
|
|
|
14,922 |
|
|
|
13,126 |
|
|
Total operating expenses |
|
4,285 |
|
|
|
3,246 |
|
|
|
15,051 |
|
|
|
13,260 |
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(3,345 |
) |
|
|
(2,689 |
) |
|
|
(12,836 |
) |
|
|
(11,456 |
) |
|
|
|
|
|
|
|
|
|
|
Other
(expense) income, net: |
|
|
|
|
|
|
|
|
Interest expense |
|
- |
|
|
|
(434 |
) |
|
|
(461 |
) |
|
|
(1,484 |
) |
|
Loss on extinguishment of debt |
|
- |
|
|
|
- |
|
|
|
(300 |
) |
|
|
- |
|
|
Other (expense) income, net |
|
(1,091 |
) |
|
|
2,046 |
|
|
|
(449 |
) |
|
|
2,046 |
|
|
Loss before
income tax |
|
(4,436 |
) |
|
|
(1,077 |
) |
|
|
(14,046 |
) |
|
|
(10,894 |
) |
|
Income tax benefit |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,526 |
|
|
|
|
|
|
|
|
|
|
|
Net loss and
comprehensive loss |
$ |
(4,436 |
) |
|
$ |
(1,077 |
) |
|
$ |
(14,046 |
) |
|
$ |
(9,368 |
) |
|
Less:
accumulated dividends on Series A and Series B preferred stock |
|
(1,368 |
) |
|
|
- |
|
|
|
(3,192 |
) |
|
|
- |
|
|
Net loss
available to common stockholders, basic and diluted |
$ |
(5,804 |
) |
|
$ |
(1,077 |
) |
|
$ |
(17,238 |
) |
|
$ |
(9,368 |
) |
|
Basic and
diluted net loss per share available to common stockholders |
$ |
(0.51 |
) |
|
$ |
(0.10 |
) |
|
$ |
(1.53 |
) |
|
$ |
(0.89 |
) |
|
Weighted
average shares used in computing basic and diluted net loss per
share available to common stockholders |
|
11,311 |
|
|
|
11,019 |
|
|
|
11,279 |
|
|
|
10,537 |
|
|
|
|
|
|
|
|
|
|
|
XOMA CORPORATION |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(unaudited) |
(in thousands, except share and per share
amounts) |
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
|
|
2021 |
|
|
|
2020 |
|
|
ASSETS |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash |
|
$ |
68,757 |
|
|
$ |
84,222 |
|
|
Restricted cash |
|
|
3,417 |
|
|
|
1,611 |
|
|
Short-term equity securities |
|
|
1,211 |
|
|
|
- |
|
|
Trade and other receivables, net |
|
|
518 |
|
|
|
263 |
|
|
Income tax receivable |
|
|
- |
|
|
|
1,526 |
|
|
Prepaid expenses and other current assets |
|
|
969 |
|
|
|
443 |
|
|
Total current assets |
|
|
74,872 |
|
|
|
88,065 |
|
|
Long-term restricted cash |
|
|
- |
|
|
|
531 |
|
|
Property and equipment,
net |
|
|
15 |
|
|
|
21 |
|
|
Operating lease right-of-use
assets |
|
|
240 |
|
|
|
359 |
|
|
Long-term royalty
receivables |
|
|
55,075 |
|
|
|
34,575 |
|
|
Long-term equity
securities |
|
|
- |
|
|
|
1,693 |
|
|
Other assets |
|
|
301 |
|
|
|
41 |
|
|
Total assets |
|
$ |
130,503 |
|
|
$ |
125,285 |
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
598 |
|
|
$ |
456 |
|
|
Accrued and other liabilities |
|
|
1,325 |
|
|
|
642 |
|
|
Contingent consideration under royalty purchase agreements |
|
|
75 |
|
|
|
75 |
|
|
Operating lease liabilities |
|
|
191 |
|
|
|
179 |
|
|
Unearned revenue recognized under units-of-revenue method |
|
|
1,541 |
|
|
|
1,452 |
|
|
Contingent liabilities |
|
|
1,410 |
|
|
|
1,410 |
|
|
Current portion of long-term debt |
|
|
- |
|
|
|
8,088 |
|
|
Preferred stock dividend accrual |
|
|
1,368 |
|
|
|
- |
|
|
Total current liabilities |
|
|
6,508 |
|
|
|
12,302 |
|
|
Unearned revenue recognized
under units-of-revenue method – long-term |
|
|
12,306 |
|
|
|
13,516 |
|
|
Long-term debt |
|
|
- |
|
|
|
12,764 |
|
|
Long-term operating lease
liabilities |
|
|
85 |
|
|
|
229 |
|
|
Other liabilities –
long-term |
|
|
20 |
|
|
|
50 |
|
|
Total liabilities |
|
|
18,919 |
|
|
|
38,861 |
|
|
|
|
|
|
|
|
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 September 30, 2021 and December
31, 2020 |
|
|
49 |
|
|
|
49 |
|
|
8.375% Series B cumulative, perpetual preferred stock, 1,600 and
zero shares issued and outstanding at September 30, 2021 and
December 31, 2020, respectively |
|
|
- |
|
|
|
- |
|
|
Convertible preferred stock, 5,003 shares issued and outstanding at
September 30, 2021 and December 31, 2020 |
|
|
- |
|
|
|
- |
|
|
Common stock, $0.0075 par value, 277,333,332 shares authorized,
11,311,231 and 11,228,792 shares issued and outstanding at
September 30, 2021 and December 31, 2020, respectively |
|
|
85 |
|
|
|
84 |
|
|
Additional paid-in capital |
|
|
1,306,582 |
|
|
|
1,267,377 |
|
|
Accumulated deficit |
|
|
(1,195,132 |
) |
|
|
(1,181,086 |
) |
|
Total stockholders’ equity |
|
|
111,584 |
|
|
|
86,424 |
|
|
Total liabilities and stockholders’ equity |
|
$ |
130,503 |
|
|
$ |
125,285 |
|
|
Investor contacts: |
|
Juliane Snowden |
Justin Frantz |
XOMA |
Solebury Trout |
+1-646-438-9754 |
+1-973-441-9731 |
juliane.snowden@xoma.com |
jfrantz@troutgroup.com |
|
|
Media contact: |
|
Kathy Vincent |
|
KV Consulting & Management |
|
+1-310-403-8951 |
|
kathy@kathyvincent.com |
|
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