Xenon Pharmaceuticals Reports Inducement Grants Under Nasdaq Listing Rule 5635(c)(4)

Rhea-AI Summary

Xenon Pharmaceuticals (Nasdaq: XENE) announced inducement equity grants to ten new non-officer employees totaling 42,300 share options, approved by the Compensation Committee with an effective date of January 15, 2026 under Nasdaq Listing Rule 5635(c)(4).

The options have an exercise price of $40.74 per share (equal to the closing price on the grant date), vest over four years with 25% vesting after one year and the remainder vesting monthly (1/36th) thereafter, and each option has a 10-year term and is subject to the company’s 2025 Inducement Equity Incentive Plan and option agreements.

Key Figures

Inducement options: 42,300 share options Option exercise price: $40.74 per share Vesting initial cliff: 25% after one year +5 more

8 metrics

Inducement options 42,300 share options Aggregate grant to ten new non-officer employees

Option exercise price $40.74 per share Equal to XENE closing price on January 15, 2026 grant date

Vesting initial cliff 25% after one year First tranche vests on one-year anniversary of each start date

Monthly vesting fraction 1/36 of remaining Remaining options vest monthly over subsequent three years

Option term 10 years Term of inducement share options

Azetukalner trial phase Phase 3 Clinical trials in epilepsy, MDD and bipolar depression

Pain programs phase Phase 1 KV7 and NaV1.7 programs in development for pain

Pre-news share price $40.74 Last close before inducement grant press release

Market Reality Check

Price: $39.97 Vol: Volume 865,663 is 0.88x t...

normal vol

$39.97 Last Close

Volume Volume 865,663 is 0.88x the 20-day average volume of 984,693 shares, indicating subdued trading activity before this news. normal

Technical Shares at $40.74 were trading above the 200-day MA of $36.91 and about 12.58% below the 52-week high of $46.60 before the announcement.

Peers on Argus

Before this news, XENE was down 2.02%. Most close biotech peers were also lower ...

Before this news, XENE was down 2.02%. Most close biotech peers were also lower (e.g., VKTX -7.27%, IMVT -4.87%, RARE -1.55%, SLNO -0.76%), while SRRK rose 2.40%, suggesting mixed but generally weak sector sentiment rather than a XENE-specific move.

Historical Context

5 past events · Latest: Jan 12 (Positive)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Jan 12	Milestone outlook	Positive	-2.2%	Outlined X‑TOLE2 data timing and NDA plans plus broader Phase 3 pipeline.
Jan 05	Conference presentation	Neutral	-6.1%	Announced J.P. Morgan presentation schedule and summarized pipeline stages.
Dec 05	Clinical data update	Positive	+0.7%	Reported durable 48‑month azetukalner seizure reductions and seizure‑free intervals.
Dec 04	Inducement grants	Neutral	+0.7%	Granted 39,250 options to new hires under inducement equity plan.
Dec 03	Investor webinar	Positive	+3.3%	Announced webinar to review AES 2025 azetukalner data and commercialization plans.

Pattern Detected

Recent clinically focused and event-related news has often seen mixed to negative next-day price reactions, even when operational updates appeared positive.

Recent Company History

Over the past few months, Xenon has highlighted advancing late-stage epilepsy and neuropsychiatry programs and growing corporate activity. In Dec 2025, it shared new 48‑month azetukalner OLE data with strong seizure reductions and held an investor webinar on commercialization plans. The company also used its 2026 J.P. Morgan appearance to outline X‑TOLE2 topline data timing and an anticipated H2 2026 NDA. Inducement grants have appeared periodically, framing today’s grants as part of ongoing hiring and incentive practices.

Market Pulse Summary

This announcement details routine inducement grants of 42,300 options at $40.74 for new hires under ...

Analysis

This announcement details routine inducement grants of 42,300 options at $40.74 for new hires under Nasdaq Listing Rule 5635(c)(4). It sits against a backdrop of an advancing Phase 3 program for azetukalner and Phase 1 pain candidates. Investors may track future filings for additional equity awards, upcoming X‑TOLE2 data, and regulatory milestones to assess execution and potential dilution from ongoing stock-based compensation.

Key Terms

nasdaq listing rule 5635(c)(4), phase 3 clinical trials, phase 1 development, kv7 potassium channel opener, +2 more

6 terms

nasdaq listing rule 5635(c)(4) regulatory

"were granted as inducements material to the employees... in accordance with Nasdaq Listing Rule 5635(c)(4)."

NASDAQ Listing Rule 5635(c)(4) is a rule that requires a company to get approval from its shareholders before selling a large amount of its shares, usually over 20%. This helps protect investors by making sure the company doesn't flood the market with new shares without their say, which could lower the stock's value.

phase 3 clinical trials medical

"azetukalner, is a novel, potent KV7 potassium channel opener in Phase 3 clinical trials for the treatment of epilepsy, major depressive disorder (MDD) and bipolar depression (BPD)."

Phase 3 clinical trials are large, late-stage studies that test a drug or medical treatment in hundreds to thousands of patients to confirm it is safe and effective and to compare it with existing options. Investors care because positive results are a key step toward regulatory approval and commercial sales, reducing uncertainty much like a full dress rehearsal before a product launch; negative results can sharply reduce a program’s value.

phase 1 development medical

"including KV7 and NaV1.7 programs in Phase 1 development for the potential treatment of pain."

Phase 1 development is the first stage of testing a new drug or medical therapy in humans, focused on safety, how the body handles the treatment, and identifying a safe dose range. For investors it is an early milestone that reduces uncertainty—think of it like a prototype’s first test drive: passing it doesn’t prove long-term success but failing it can halt the program and materially affect a company’s value.

kv7 potassium channel opener medical

"Xenon’s lead molecule, azetukalner, is a novel, potent KV7 potassium channel opener in Phase 3 clinical trials..."

A Kv7 potassium channel opener is a drug that helps certain cellular ‘gates’ called Kv7 channels stay open so potassium can flow out of cells, calming electrical activity in nerves and muscle. For investors, these compounds matter because they can form the basis of treatments for conditions driven by excessive electrical firing—like some seizures, pain, or heart rhythm disorders—so successful candidates can create new medical markets or reduce risks in drug pipelines.

nav1.7 medical

"including KV7 and NaV1.7 programs in Phase 1 development for the potential treatment of pain."

NAV1.7 is a specific protein in nerve cells that helps transmit pain signals to the brain; think of it as a gatekeeper that opens and closes to let electrical messages through. Investors watch drugs that block or modify NAV1.7 because successful therapies could relieve chronic pain without opioids, creating large market opportunities, while clinical setbacks or safety issues can sharply affect a company's valuation.

inducement equity incentive plan financial

"subject to the terms and conditions of the share option agreement and the terms of the Company’s Amended and Restated 2025 Inducement Equity Incentive Plan."

An inducement equity incentive plan is a program that grants employees or executives company shares or stock options to motivate and reward their work, often as a way to attract new talent. It aligns their interests with the company's success, encouraging them to contribute to long-term growth. For investors, such plans can influence a company's stock performance and overall financial health by motivating key personnel.

AI-generated analysis. Not financial advice.

VANCOUVER, British Columbia and BOSTON, Jan. 16, 2026 (GLOBE NEWSWIRE) -- Xenon Pharmaceuticals Inc. (Nasdaq: XENE), a neuroscience-focused biopharmaceutical company dedicated to drug discovery, clinical development, and commercialization of life-changing therapeutics for patients in need, today announced equity inducement grants to ten new non-officer employees consisting of an aggregate of 42,300 share options. All of the foregoing share options were approved by the Compensation Committee of the Company’s Board of Directors with an effective date of January 15, 2026 and were granted as inducements material to the employees entering into employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4).

The share options have an exercise price of $40.74 per common share, which is equal to the closing price per share of Xenon’s common shares on the grant date of January 15, 2026. The share option grants vest over four years, with 25% vesting on the one-year anniversary of the respective employee’s start date and 1/36th of the remaining options vesting monthly thereafter on the last day of each month, subject to such option recipient’s continued service relationship with the Company. Each option has a 10-year term and is subject to the terms and conditions of the share option agreement and the terms of the Company’s Amended and Restated 2025 Inducement Equity Incentive Plan.

About Xenon Pharmaceuticals Inc.
Xenon Pharmaceuticals (Nasdaq: XENE) is a neuroscience-focused biopharmaceutical company dedicated to drug discovery, clinical development, and commercialization of life-changing therapeutics for patients in need. Xenon’s lead molecule, azetukalner, is a novel, potent K_V7 potassium channel opener in Phase 3 clinical trials for the treatment of epilepsy, major depressive disorder (MDD) and bipolar depression (BPD). Xenon is also advancing an early-stage portfolio of multiple promising potassium and sodium channel modulators, including K_V7 and Na_V1.7 programs in Phase 1 development for the potential treatment of pain. Xenon has offices in Vancouver, British Columbia, and Boston, Massachusetts. For more information, visit www.xenon-pharma.com and follow us on LinkedIn and X.

Xenon and the Xenon logo are registered trademarks or trademarks of Xenon Pharmaceuticals Inc. in the US, Canada, and elsewhere. All other trademarks belong to their respective owner.

Contacts

For Investors:
Tucker Kelly
Chief Financial Officer
investors@xenon-pharma.com

For Media:
Colleen Alabiso
Senior Vice President, Corporate Affairs
media@xenon-pharma.com

FAQ

What did Xenon Pharmaceuticals (XENE) announce on January 16, 2026 about equity inducement grants?

Xenon announced grants of 42,300 share options to ten new non-officer employees, effective January 15, 2026, under Nasdaq Listing Rule 5635(c)(4).

What is the exercise price and grant date for XENE's inducement options?

Each option has an exercise price of $40.74, equal to Xenon’s closing share price on the grant date of January 15, 2026.

How do the Xenon (XENE) inducement options vest and what is the term?

Options vest over four years with 25% at one year and the remainder vesting monthly (1/36th); each option has a 10-year term.

Under which plan and approval were XENE inducement options granted?

The grants were approved by the Compensation Committee and are subject to the company’s Amended and Restated 2025 Inducement Equity Incentive Plan and option agreements.

Who received the inducement grants from Xenon (XENE)?

The awards were made to ten new non-officer employees as inducements to enter employment with the company.

Do Xenon’s inducement options reflect a premium or discount to market on the grant date?

The exercise price of $40.74 equals the closing market price on the grant date, so they were granted at market price.