XOMA Royalty Reports Third Quarter 2024 Financial Results and Highlights Recent Activities
Rhea-AI Summary
XOMA Royalty reported Q3 2024 financial results with total income of $7.2 million, including $6.5 million from commercial products. Cash receipts totaled $9.9 million in Q3 and $42.3 million for the first nine months of 2024. The company recorded a net loss of $17.2 million, primarily due to a $14.0 million non-cash impairment related to Agenus. Notable events include FDA approval of MIPLYFFA™ for Niemann-Pick disease Type C and acquisition of 50% economic interest in TWIST Bioscience's portfolio of 60-plus licensed early-stage assets. Cash position stood at $146.8 million as of September 30, 2024.
Positive
- FDA approval of MIPLYFFA™ adds sixth commercial asset to portfolio
- Acquisition of 50% interest in TWIST Bioscience's 60+ licensed assets
- Total income increased to $7.2M in Q3 2024 from $0.8M in Q3 2023
- Strong cash position of $146.8M as of September 30, 2024
- Cash receipts of $9.9M in Q3 and $42.3M YTD
Negative
- Net loss increased to $17.2M in Q3 2024 from $5.5M in Q3 2023
- $14.0M non-cash impairment charge related to Agenus
- G&A expenses increased to $8.0M from $6.4M YoY
- Interest expense of $3.5M related to Blue Owl Loan
- Net cash used in operating activities was $8.6M
Insights
The Q3 2024 results show mixed performance with notable developments.
The addition of MIPLYFFA™ as the sixth commercial asset and the strategic
The FDA approval of MIPLYFFA™ for Niemann-Pick disease Type C represents a significant milestone as the first approved therapy for this rare genetic disorder. This addition to XOMA's portfolio is particularly valuable given the unmet medical need and competition in the NPC space.
The diversification strategy through the Twist Bioscience deal adds exposure to 60-plus early-stage assets across multiple therapeutic areas. However, the setback in Johnson & Johnson's cetrelimab Phase 3 trial in MIBC highlights the inherent risks in drug development. The upcoming Takeda R&D Day discussion on mezagitamab could provide additional pipeline visibility.
Zevra’s MIPLYFFA™ (arimoclomol) received FDA approval and became the sixth commercial asset in XOMA Royalty’s portfolio
XOMA Royalty acquired a 50 percent economic interest in TWIST Bioscience’s portfolio of 60-plus licensed early-stage assets across approximately 30 partners
Cash receipts totaled
EMERYVILLE, Calif., Nov. 07, 2024 (GLOBE NEWSWIRE) -- XOMA Royalty Corporation (NASDAQ: XOMA), the biotech royalty aggregator, reported its third quarter 2024 financial results and highlighted recent activities.
“We continue to take a balanced approach to building a portfolio of sustainable cashflow streams by selectively acquiring royalty economics across the lifecycle of drug development,” stated Owen Hughes, Chief Executive Officer of XOMA Royalty. “The September approval of MIPLYFFA™, the first therapy approved for patients living with Niemann-Pick disease Type C, adds to our growing commercial royalty portfolio, while the recent transaction with Twist Bioscience further expands our early-stage portfolio, a key focus for us as we look to distribute risk across a diversified portfolio.”
Key Third Quarter Events
| Partner | Event |
| Zevra Therapeutics | The U.S. Food and Drug Administration (FDA) approved Zevra’s MIPLYFFA™ (arimoclomol) capsules as an orally delivered treatment for Niemann-Pick disease type C (NPC). MIPLYFFA™ is indicated for use in combination with miglustat for the treatment of neurological manifestations of NPC in adult and pediatric patients 2 years of age and older. |
| Rezolute | Announced the sunRIZE Phase 3 clinical trial investigating ersodetug (RZ358) in patients with congenital hyperinsulinism (CHI) will begin enrolling patients in the U.S. in early 2025¹. Received FDA clearance to initiate Phase 3 registrational study for ersodetug for the treatment of hypoglycemia due to tumor hyperinsulinism². |
| Johnson & Johnson | Presented neoadjuvant TAR-200 plus cetrelimab Phase 2 data in patients with muscle-invasive bladder cancer (MIBC) who are ineligible or refuse neoadjuvant platinum-based chemotherapy and are scheduled for radical cystectomy at the European Society of Medical Oncology 2024 Congress³. |
Subsequent Events
| Partner | Event |
| Twist Bioscience | XOMA Royalty completed a |
| Johnson & Johnson | Announced one of two Phase 3 clinical trials in difficult to treat muscle-invasive bladder cancer (MIBC) that included treatment with cetrelimab was being discontinued for not showing superiority to chemoradiation during a scheduled interim analysis⁴. Cetrelimab continues to be investigated in multiple other clinical trials. |
Anticipated 2024 Events of Note
| Partner | Event |
| Takeda | On December 12, 2024, Takeda will be hosting an R&D Day: Focus on Late-State Pipeline and Market Opportunity and has commented publicly mezagitamab will be discussed during this investor event. |
Third Quarter 2024 Financial Results
XOMA Royalty recorded total income and revenues of
Research and development (R&D) expenses were
General and administrative (“G&A”) expenses were
In the third quarter of 2024, as a result of communications with Agenus, XOMA Royalty evaluated the status of the partnered programs underlying the Agenus Royalty Purchase Agreement for potential impairment and recorded a one-time, non-cash impairment charge of
In the third quarters of 2024 and 2023, G&A expenses included
Total interest expense in the third quarter of 2024 was
The Company reported total other income, net, of
Net loss for the third quarter of 2024 was
On September 30, 2024, XOMA Royalty had cash and cash equivalents of
About XOMA Royalty Corporation
XOMA Royalty is a biotechnology royalty aggregator playing a distinctive role in helping biotech companies achieve their goal of improving human health. XOMA Royalty acquires the potential future economics associated with pre-commercial and commercial therapeutic candidates that have been licensed to pharmaceutical or biotechnology companies. When XOMA Royalty 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 or follow XOMA Royalty Corporation on LinkedIn.
Forward-Looking Statements/Explanatory Notes
Certain 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 Royalty and other developments related to VABYSMO® (faricimab-svoa), OJEMDA™ (tovorafenib), MIPLYFFA™ (arimoclomol), XACIATO™ (clindamycin phosphate) vaginal gel
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, the commercial assets in XOMA Royalty’s milestone and royalty portfolio are VABYSMO® (faricimab-svoa), OJEMDA™ (tovorafenib), MIPLYFFA™ (arimoclomol), XACIATO™ (clindamycin phosphate) vaginal gel
| XOMA ROYALTY CORPORATION | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| (in thousands, except per share amounts) | ||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Income and revenues: | ||||||||||||||||
| Income from purchased receivables | $ | 6,463 | $ | — | $ | 11,895 | $ | — | ||||||||
| Revenue from contracts with customers | 25 | 225 | 6,050 | 1,350 | ||||||||||||
| Revenue recognized under units-of-revenue method | 709 | 605 | 1,828 | 1,575 | ||||||||||||
| Total income and revenues | 7,197 | 830 | 19,773 | 2,925 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 817 | 25 | 2,011 | 118 | ||||||||||||
| General and administrative | 8,020 | 6,368 | 27,485 | 18,341 | ||||||||||||
| Royalty purchase agreement asset impairment | 14,000 | — | 23,000 | 1,575 | ||||||||||||
| Arbitration settlement costs | — | — | — | 4,132 | ||||||||||||
| Amortization of intangible assets | — | 224 | — | 673 | ||||||||||||
| Total operating expenses | 22,837 | 6,617 | 52,496 | 24,839 | ||||||||||||
| Loss from operations | (15,640 | ) | (5,787 | ) | (32,723 | ) | (21,914 | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Gain on the acquisition of Kinnate | — | — | 19,316 | — | ||||||||||||
| Change in fair value of embedded derivative related to RPA | — | — | 8,100 | — | ||||||||||||
| Interest expense | (3,493 | ) | — | (10,446 | ) | — | ||||||||||
| Other income (expense), net | 1,890 | 278 | 5,900 | 1,192 | ||||||||||||
| Net loss | $ | (17,243 | ) | $ | (5,509 | ) | $ | (9,853 | ) | $ | (20,722 | ) | ||||
| Net loss attributable to common stockholders, basic | $ | (18,611 | ) | $ | (6,877 | ) | $ | (13,957 | ) | $ | (24,826 | ) | ||||
| Basic net loss per share attributable to common stockholders | $ | (1.59 | ) | $ | (0.60 | ) | $ | (1.20 | ) | $ | (2.17 | ) | ||||
| Weighted average shares used in computing basic net loss per share attributable to common stockholders | 11,712 | 11,473 | 11,645 | 11,466 | ||||||||||||
| Net loss attributable to common stockholders, diluted | $ | (18,611 | ) | $ | (6,877 | ) | $ | (13,957 | ) | $ | (24,826 | ) | ||||
| Diluted net loss per share attributable to common stockholders | $ | (1.59 | ) | $ | (0.60 | ) | $ | (1.20 | ) | $ | (2.17 | ) | ||||
| Weighted average shares used in computing diluted net loss per share attributable to common stockholders | 11,712 | 11,473 | 11,645 | 11,466 | ||||||||||||
| XOMA ROYALTY CORPORATION | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (in thousands, except share and per share amounts) | ||||||||
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| ASSETS | (unaudited) | |||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 142,050 | $ | 153,290 | ||||
| Short-term restricted cash | 80 | 160 | ||||||
| Short-term equity securities | 785 | 161 | ||||||
| Trade and other receivables, net | 1,045 | 1,004 | ||||||
| Short-term royalty and commercial payment receivables | 12,682 | 14,215 | ||||||
| Prepaid expenses and other current assets | 2,379 | 483 | ||||||
| Total current assets | 159,021 | 169,313 | ||||||
| Long-term restricted cash | 4,686 | 6,100 | ||||||
| Property and equipment, net | 34 | 25 | ||||||
| Operating lease right-of-use assets | 335 | 378 | ||||||
| Long-term royalty and commercial payment receivables | 54,207 | 57,952 | ||||||
| Exarafenib milestone asset | 3,125 | — | ||||||
| Other assets - long term | 1,932 | 533 | ||||||
| Total assets | $ | 223,340 | $ | 234,301 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,131 | $ | 653 | ||||
| Accrued and other liabilities | 2,451 | 2,768 | ||||||
| Contingent consideration under RPAs, AAAs, and CPPAs | 4,000 | 7,000 | ||||||
| Operating lease liabilities | 434 | 54 | ||||||
| Unearned revenue recognized under units-of-revenue method | 1,924 | 2,113 | ||||||
| Preferred stock dividend accrual | 1,368 | 1,368 | ||||||
| Current portion of long-term debt | 9,826 | 5,543 | ||||||
| Total current liabilities | 21,134 | 19,499 | ||||||
| Unearned revenue recognized under units-of-revenue method – long-term | 5,589 | 7,228 | ||||||
| Exarafenib milestone contingent consideration | 3,125 | — | ||||||
| Long-term operating lease liabilities | 594 | 335 | ||||||
| Long-term debt | 108,089 | 118,518 | ||||||
| Total liabilities | 138,531 | 145,580 | ||||||
| Stockholders’ equity: | ||||||||
| Preferred Stock, | ||||||||
| 49 | 49 | |||||||
| — | — | |||||||
| Convertible preferred stock, 5,003 issued and outstanding at September 30, 2024 and December 31, 2023 | — | — | ||||||
| Common stock, | 88 | 86 | ||||||
| Additional paid-in capital | 1,317,657 | 1,311,809 | ||||||
| Accumulated other comprehensive income | 104 | — | ||||||
| Accumulated deficit | (1,233,089 | ) | (1,223,223 | ) | ||||
| Total stockholders’ equity | 84,809 | 88,721 | ||||||
| Total liabilities and stockholders’ equity | $ | 223,340 | $ | 234,301 | ||||
| XOMA ROYALTY CORPORATION | ||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| (unaudited) | ||||||||
| (in thousands) | ||||||||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (9,853 | ) | $ | (20,722 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Income from purchased receivables under effective interest rate method | (9,985 | ) | — | |||||
| Stock-based compensation expense | 8,136 | 6,450 | ||||||
| Royalty purchase agreement asset impairment | 23,000 | 1,575 | ||||||
| Gain on the acquisition of Kinnate | (19,316 | ) | — | |||||
| Change in fair value of contingent consideration under RPAs, AAAs, and CPPAs | — | (75 | ) | |||||
| Common stock contribution to 401(k) | 118 | 123 | ||||||
| Amortization of intangible assets | — | 673 | ||||||
| Depreciation | 8 | 2 | ||||||
| Accretion of long-term debt discount and debt issuance costs | 996 | — | ||||||
| Non-cash lease expense | 45 | 115 | ||||||
| Change in fair value of equity securities | (624 | ) | 121 | |||||
| Change in fair value of available-for-sale debt securities classified as cash equivalents | 104 | — | ||||||
| Changes in assets and liabilities: | ||||||||
| Trade and other receivables, net | (41 | ) | (42 | ) | ||||
| Prepaid expenses and other assets | (72 | ) | (202 | ) | ||||
| Accounts payable and accrued liabilities | (1,348 | ) | (554 | ) | ||||
| Operating lease liabilities | (185 | ) | (120 | ) | ||||
| Unearned revenue recognized under units-of-revenue method | (1,828 | ) | (1,575 | ) | ||||
| Net cash used in operating activities | (10,845 | ) | (14,231 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Net cash acquired in Kinnate acquisition | 18,926 | — | ||||||
| Payments of consideration under RPAs, AAAs, and CPPAs | (37,000 | ) | (14,650 | ) | ||||
| Receipts under RPAs, AAAs, and CPPAs | 26,263 | 8,428 | ||||||
| Purchase of property and equipment | (17 | ) | — | |||||
| Net cash provided by (used in) investing activities | 8,172 | (6,222 | ) | |||||
| Cash flows from financing activities: | ||||||||
| Principal payments — debt | (6,902 | ) | — | |||||
| Debt issuance costs and loan fees paid in connection with long-term debt | (740 | ) | — | |||||
| Payment of preferred stock dividends | (4,104 | ) | (4,104 | ) | ||||
| Repurchases of common stock | (13 | ) | — | |||||
| Proceeds from exercise of options and other share-based compensation | 4,127 | 208 | ||||||
| Taxes paid related to net share settlement of equity awards | (2,429 | ) | (5 | ) | ||||
| Net cash used in financing activities | (10,061 | ) | (3,901 | ) | ||||
| Net decrease in cash, cash equivalents, and restricted cash | (12,734 | ) | (24,354 | ) | ||||
| Cash, cash equivalents, and restricted cash as of the beginning of the period | 159,550 | 57,826 | ||||||
| Cash, cash equivalents, and restricted cash as of the end of the period | $ | 146,816 | $ | 33,472 | ||||
| Supplemental Cash Flow Information: | ||||||||
| Cash paid for interest | $ | 9,985 | $ | — | ||||
| Right-of-use assets obtained in exchange for operating lease liabilities | $ | — | $ | 85 | ||||
| Non-cash investing and financing activities: | ||||||||
| Estimated initial fair value of the Exarafenib milestone asset in Kinnate acquisition | $ | 2,922 | $ | — | ||||
| Estimated initial fair value of the Exarafenib milestone contingent consideration in Kinnate acquisition | $ | 2,922 | $ | — | ||||
| Right-of-use assets obtained in exchange for operating lease liabilities in Kinnate acquisition | $ | 824 | $ | — | ||||
| Relative fair value basis reduction of right-of-use assets in Kinnate acquisition | $ | (824 | ) | $ | — | |||
| Accrual of contingent consideration under the Affitech CPPA | $ | 3,000 | $ | 3,000 | ||||
| Accrual of contingent consideration under the LadRx AAA | $ | 1,000 | — | |||||
| Estimated fair value of contingent consideration under the LadRx Agreements | $ | — | $ | 1,000 | ||||
| Preferred stock dividend accrual | $ | 1,368 | $ | 1,368 | ||||
| Investor contact: | Media contact: |
| Juliane Snowden | Kathy Vincent |
| XOMA Royalty Corporation | KV Consulting & Management |
| +1-646-438-9754 | +1-310-403-8951 |
| juliane.snowden@xoma.com | kathy@kathyvincent.com |
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¹ https://ir.rezolutebio.com/news/detail/339/fda-lifts-partial-clinical-holds-on-rz358-for-the-treatment-of-congenital-hyperinsulinism-and-authorizes-u-s-inclusion-in-ongoing-phase-3-study
² https://ir.rezolutebio.com/news/detail/337/rezolute-announces-fda-clearance-of-ind-application-for-phase-3-registrational-study-of-rz358-for-treatment-of-hypoglycemia-due-to-tumor-hyperinsulinism
³ https://www.jnj.com/media-center/press-releases/neoadjuvant-tar-200-plus-cetrelimab-nearly-doubles-the-pathological-complete-response-rate-compared-to-cetrelimab-alone-in-patients-with-muscle-invasive-bladder-cancer
⁴ https://www.jnj.com/media-center/press-releases/johnson-johnson-statement-on-the-sunrise-2-study
FAQ
What was XOMA's revenue in Q3 2024?
Why did XOMA stock report a net loss in Q3 2024?
What major FDA approval did XOMA receive in Q3 2024?
How much cash does XOMA have as of Q3 2024?
