XOMA Corporation (Nasdaq: XOMA) reported its second quarter 2021
financial results and provided a recent operations update.
“The events we have announced over the past four months reflect
many more months of hard work by our team and our partners.
On the acquisition side of our potential milestone and royalty
asset business, we added Day One Biopharmaceuticals’ DAY101
(pan-RAF kinase inhibitor), Checkmate Pharmaceuticals’ vidotulimod
(CMP-001), and Denovo Biopharma’s vosaroxin (topoisomerase II
inhibitor) to our growing list of partner-funded assets.
XOMA’s legacy technology license agreements resulted in the
addition of three clinical-stage assets being developed by Affimed
to our portfolio,” stated Jim Neal, Chief Executive Officer of
XOMA.
“Our asset partners also have had successes with assets in
XOMA’s portfolio. In May, Janssen launched a Phase 3 study
with cetrelimab (anti-PD-1 monoclonal antibody). In
conjunction with the first NIS793 (anti-TGFβ monoclonal antibody)
clinical data presentation at ASCO in June, Novartis announced its
intention to begin a Phase 3 study with NIS793 later in 2021.
Also at ASCO, AVEO reported data from the ficlatuzumab Phase 2
study in head and neck squamous cell carcinoma and its desire to
move ficlatuzumab into Phase 3 development. Last week, we
were pleased to learn of two important designations granted by the
FDA. NIS793 in combination with standard of care chemotherapy
now has Orphan Drug Designation for the treatment of pancreatic
cancer, and Day One Pharmaceuticals announced DAY101 has received
Rare Pediatric Drug Designation for the treatment of pediatric
low-grade glioma. Each of our license partners continues to
invest significant resources to bring potential new therapies one
step closer to physicians and patients.
“Today, we have a very strong balance sheet, which is debt free
and paired with a lean expense structure. Our April offering
of Series B Perpetual Preferred Stock, which pays an 8.375%
dividend, raised an additional $40 million. At the end of the
second quarter, we had $78.9 million in cash. In July, we paid
dividends on both the XOMAP and XOMAO Perpetual Preferred
Stocks.
“We look forward to continued progress by our team and by our
partners,” Mr. Neal concluded.
Financial ResultsXOMA recorded total revenues
of $0.9 million for the second quarter of 2021, compared to $0.4
million for the second quarter of 2020. The increase for the
three months ended June 30, 2021, as compared to the same period in
2020, was primarily due to $0.5 million in revenue recognized in
the second quarter of 2021 related to a milestone event under
XOMA’s license agreement with Janssen.
Research and development expenses were $38,000 for both second
quarters of 2021 and 2020.
General and administrative (“G&A”) expenses were $3.9
million for the second quarter of 2021, compared to $3.6 million
for the second quarter of 2020. The increase of $0.3 million
for the three months ended June 30, 2021, as compared to the same
period of 2020, was primarily due to a $0.3 million increase in
salaries and related expenses.
In the second quarter of 2021, G&A expenses included $0.8
million in non-cash stock-based compensation expense, which was
consistent with the second quarter of 2020. The Company’s net
cash used in operations in the second quarter of 2021 was $4.0
million, as compared with $2.9 million during the second quarter of
2020.
In the second quarter of 2021, XOMA recorded $0.2 million in
total interest expense, as compared to $0.5 million in the
corresponding period of 2020. In June 2021, the Company
repaid its outstanding debt obligations to Silicon Valley Bank and
Novartis in full and recognized a $0.3 million non-cash loss on the
extinguishment of debt.
For the quarters ended June 30, 2021 and 2020, XOMA recorded
total other income of $1.3 million, and $0.1 million, respectively,
reflecting the change in the fair value of equity securities.
Net loss for the second quarter of 2021 was $2.2 million,
compared to net loss of $3.5 million for the second quarter of
2020.
On June 30, 2021, XOMA had cash of $78.9 million. The
Company ended December 31, 2020, with cash of $84.2 million.
On April 12, 2021, XOMA announced the closing of its Depositary
Shares Offering and the exercise of the underwriters’ option, which
resulted in approximately $38.0 million after deducting
underwriting discounts and commissions, but before expenses.
On April 15, 2021, the Company paid its first dividend on Series A
Cumulative Perpetual Preferred (Nasdaq: XOMAP) in the amount of
$0.71875 per share. 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 June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue from contracts with customers |
$ |
525 |
|
|
$ |
53 |
|
|
$ |
544 |
|
|
$ |
553 |
|
Revenue recognized under units-of-revenue method |
|
376 |
|
|
|
391 |
|
|
|
731 |
|
|
|
695 |
|
Total revenues |
|
901 |
|
|
|
444 |
|
|
|
1,275 |
|
|
|
1,248 |
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
Research and development |
|
38 |
|
|
|
38 |
|
|
|
99 |
|
|
|
100 |
|
General and administrative |
|
3,927 |
|
|
|
3,557 |
|
|
|
10,667 |
|
|
|
9,914 |
|
Total operating expenses |
|
3,965 |
|
|
|
3,595 |
|
|
|
10,766 |
|
|
|
10,014 |
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(3,064 |
) |
|
|
(3,151 |
) |
|
|
(9,491 |
) |
|
|
(8,766 |
) |
|
|
|
|
|
|
|
|
Other income (expense),
net: |
|
|
|
|
|
|
|
Interest expense |
|
(172 |
) |
|
|
(508 |
) |
|
|
(461 |
) |
|
|
(1,050 |
) |
Loss on extinguishment of debt |
|
(300 |
) |
|
|
- |
|
|
|
(300 |
) |
|
|
- |
|
Other income (expense), net |
|
1,299 |
|
|
|
126 |
|
|
|
642 |
|
|
|
(1 |
) |
Loss before income tax |
|
(2,237 |
) |
|
|
(3,533 |
) |
|
|
(9,610 |
) |
|
|
(9,817 |
) |
Income tax benefit |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,526 |
|
|
|
|
|
|
|
|
|
Net loss and comprehensive
loss |
$ |
(2,237 |
) |
|
$ |
(3,533 |
) |
|
$ |
(9,610 |
) |
|
$ |
(8,291 |
) |
Less: accumulated dividends on
Series A and Series B preferred stock |
|
(1,293 |
) |
|
|
- |
|
|
|
(1,824 |
) |
|
|
- |
|
Net loss available to common
stockholders, basic and diluted |
$ |
(3,530 |
) |
|
$ |
(3,533 |
) |
|
$ |
(11,434 |
) |
|
$ |
(8,291 |
) |
Basic and diluted net loss per
share available to common stockholders |
$ |
(0.31 |
) |
|
$ |
(0.33 |
) |
|
$ |
(1.02 |
) |
|
$ |
(0.81 |
) |
Weighted average shares used
in computing basic and diluted net loss per share available to
common stockholders |
|
11,285 |
|
|
|
10,824 |
|
|
|
11,263 |
|
|
|
10,292 |
|
|
|
|
|
|
XOMA CORPORATION |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(unaudited) |
(in thousands, except share and per share
amounts) |
|
June 30, |
|
December 31, |
|
2021 |
|
2020 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash |
$ |
78,945 |
|
|
$ |
84,222 |
|
Restricted cash |
|
4,840 |
|
|
|
1,611 |
|
Short-term equity securities |
|
2,310 |
|
|
|
- |
|
Trade and other receivables, net |
|
12 |
|
|
|
263 |
|
Income tax receivable |
|
- |
|
|
|
1,526 |
|
Prepaid expenses and other current assets |
|
1,144 |
|
|
|
443 |
|
Total current assets |
|
87,251 |
|
|
|
88,065 |
|
Long-term restricted cash |
|
- |
|
|
|
531 |
|
Property and equipment,
net |
|
17 |
|
|
|
21 |
|
Operating lease right-of-use
assets |
|
281 |
|
|
|
359 |
|
Long-term royalty
receivables |
|
48,075 |
|
|
|
34,575 |
|
Long-term equity
securities |
|
- |
|
|
|
1,693 |
|
Other assets |
|
128 |
|
|
|
41 |
|
Total assets |
$ |
135,752 |
|
|
$ |
125,285 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
629 |
|
|
$ |
456 |
|
Accrued and other liabilities |
|
1,059 |
|
|
|
642 |
|
Contingent consideration under royalty purchase agreements |
|
75 |
|
|
|
75 |
|
Operating lease liabilities |
|
187 |
|
|
|
179 |
|
Unearned revenue recognized under units-of-revenue method |
|
1,503 |
|
|
|
1,452 |
|
Contingent liabilities |
|
1,410 |
|
|
|
1,410 |
|
Current portion of long-term debt |
|
- |
|
|
|
8,088 |
|
Preferred stock dividend accrual |
|
1,424 |
|
|
|
— |
|
Total current liabilities |
|
6,287 |
|
|
|
12,302 |
|
Unearned revenue recognized
under units-of-revenue method – long-term |
|
12,734 |
|
|
|
13,516 |
|
Long-term debt |
|
- |
|
|
|
12,764 |
|
Long-term operating lease
liabilities |
|
133 |
|
|
|
229 |
|
Other liabilities –
long-term |
|
20 |
|
|
|
50 |
|
Total liabilities |
|
19,174 |
|
|
|
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 June 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 June 30, 2021 and December
31, 2020, respectively |
|
— |
|
|
|
— |
|
Convertible preferred stock, 5,003 shares issued and outstanding at
June 30, 2021 and December 31, 2020 |
|
— |
|
|
|
— |
|
Common stock, $0.0075 par value, 277,333,332 shares authorized,
11,310,001 and 11,228,792 shares issued and outstanding at June 30,
2021 and December 31, 2020, respectively |
|
85 |
|
|
|
84 |
|
Additional paid-in capital |
|
1,307,140 |
|
|
|
1,267,377 |
|
Accumulated deficit |
|
(1,190,696 |
) |
|
|
(1,181,086 |
) |
Total stockholders’ equity |
|
116,578 |
|
|
|
86,424 |
|
Total liabilities and stockholders’ equity |
$ |
135,752 |
|
|
$ |
125,285 |
|
Investor contacts: |
|
Gitanjali Jain |
Juliane Snowden |
Solebury Trout |
XOMA |
+1-646-378-2949 |
+1-646-438-9754 |
gogawa@soleburytrout.com |
juliane.snowden@xoma.com |
|
|
Media contact: |
|
Kathy Vincent |
|
KV Consulting & Management |
|
+1-310-403-8951 |
|
kathy@kathyvincent.com |
|
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