XOMA Corporation (Nasdaq:XOMA), a leader in the discovery and
development of therapeutic antibodies, today provided a corporate
update and reported its financial results for the quarter ended
September 30, 2015.
"One hundred days ago, we announced multiple actions we would
take in order to firmly position XOMA as an endocrine company, and
we've executed on all of them," commented John Varian, Chief
Executive Officer of XOMA. "First, we raised $37 million in
non-dilutive capital by licensing our TGF beta antibody program to
Novartis. Second, we deferred the near-term debt repayment
obligation of a $13.5 million loan due to Novartis
by extending the loan's due date. These two actions improved
our cash position by $50.5 million. Third, we found strategic
alternatives to divest our non-core operations through the sale of
our biologics manufacturing facilities to Agenus, for an upfront
payment of approximately $5 million in cash and $1
million in common stock, and the divesture of our biodefense
program to Nanotherapeutics, including the transfer of
program-related employees to the acquiring companies. Finally, we
restructured the company to support our endocrine franchise, which,
in combination with the Agenus and Nanotherapeutics deals, resulted
in a headcount reduction of over 50 percent. Our employee base now
reflects the appropriate infrastructure required to rapidly advance
our endocrine franchise, particularly XOMA 358, and we have the
capital to fund our operations into 2017.
"Last month, we opened the first of two planned Phase 2
proof-of-concept studies for XOMA 358 in patients with hypoglycemia
due to hyperinsulinemia. The open-label Phase 2 clinical study will
enroll patients with congenital hyperinsulinism at two
internationally recognized treatment centers. We are very excited
about taking XOMA 358 into patients who are living with this
debilitating disease, as the Phase 1 study showed this compound can
lower insulin receptor activity in healthy volunteers," concluded
Mr. Varian.
Recent Corporate Developments
- Initiated a Phase 2 proof-of-concept study of XOMA 358 in
patients with congenital hyperinsulinism at Children's Hospital of
Philadelphia
- Licensed the company's first-in-class anti-TGF beta antibody
program to Novartis for an upfront payment of $37 million,
potential milestone payments of up to $480 million and royalties
tiered up to low double digits
- Extended the maturity date of its $13.5 million note due to
Novartis until September 2020
- Signed a definitive agreement to sell its biologics
manufacturing operations and transferred associated headcount to
Agenus Inc.
- Divested its biodefense program to Nanotherapeutics, Inc., a
biopharmaceutical company located in Alachua, Florida
- Restructured the company's internal operations to support its
endocrine franchise
- Terminated the Phase 3 EYEGUARD clinical program and associated
expenses and regained global rights to the gevokizumab program
- Achieved cash runway to finance XOMA's endocrine franchise into
2017
Financial Results
XOMA reported total revenues of $2.1 million in the third
quarter ended September 30, 2015, compared with $5.1 million in the
corresponding period of 2014. The 2015 revenues reflect lower
activity under the Company's existing contracts with National
Institute of Allergy and Infectious Diseases (NIAID) for the
development of anti-botulism agents, lower reimbursements from
Servier for gevokizumab-related expenses, and lower milestone
payments received in 2015 as compared with 2014.
Research and development (R&D) expenses for the third
quarter of 2015 were $17.6 million, compared with $20.2 million in
the corresponding period of 2014. The reduction in the 2015 R&D
expenses reflects decreases of $1.5 million in salaries and related
expenses and $1.1 million in clinical trial expenses.
Selling, general and administrative (SG&A) expenses were
$5.6 million in the third quarter of 2015, as compared to $5.4
million in the corresponding quarter of 2014, primarily reflecting
increased consulting expenses related to XOMA's out-licensing
activities, partially offset by decreased salaries and related
expenses.
The Company reported restructuring charges of $2.6 million in
the quarter ended September 30, 2015, which were associated with a
headcount reduction to reduce operating expenses to support its
endocrine franchise.
For the third quarter of 2015, XOMA reported a net loss of $0.5
million, compared with a net loss of $14.4 million for the third
quarter of 2014. Excluding non-cash charges related to the
revaluation of warrant liabilities of $24.4 million and $5.7
million in the quarters ended September 30, 2015 and 2014,
respectively, net loss was $24.9 million and $20.1 million,
respectively.
On September 30, 2015, XOMA had cash, cash equivalents, and
short-term investments of $32.0 million. In October, the
Company received $37.0 million from the Novartis transaction. The
Company ended December 31, 2014, with cash, cash equivalents, and
short-term investments of $78.4 million.
Investor Conference Call and Webcast
XOMA will host a conference call and webcast today, November 5,
2015, at 4:30 p.m. ET / 1:30 PT. The webcast can be accessed via
the Investors and Media section of XOMA's website at
http://investors.xoma.com/events.cfm and will be available for
replay until close of business on February 5, 2016. Telephone
numbers for the live audiocast are 877-369-6589 (U.S./Canada) and
408-337-0122 (international).
About XOMA Corporation
XOMA Corporation is a leader in the discovery and development of
therapeutic antibodies. The Company's innovative product candidates
result from the Company's expertise in developing ground-breaking
monoclonal antibodies, including allosteric antibodies, which have
created new opportunities to potentially treat a wide range of
human diseases. XOMA's scientific research has produced a
portfolio of six endocrine assets, each of which have the
opportunity to address multiple indications. The Company's lead
product candidate, XOMA 358, is an allosteric monoclonal antibody
that reduces insulin receptor activity, which could have a major
impact on the treatment of hyperinsulinism. The Company recently
initiated Phase 2 development activities for XOMA 358 in patients
with congenital hyperinsulinism. Additionally, XOMA is developing
gevokizumab (IL-1 beta modulating antibody) in an ongoing Phase 3
program enrolling patients with pyoderma gangrenosum, a rare
ulcerative skin condition. For more information, visit
www.xoma.com.
Forward-Looking Statements
Certain statements contained in this press release including,
but not limited to, statements related to anticipated timing,
enrollment and success of clinical trials and Proof-of-Concept
trials, therapeutic potential of our product candidates,
sufficiency of our cash resources and anticipated levels of cash
utilization, or statements that otherwise relate to future periods
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. 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 and for companies engaged in
the development of new products in a regulated
market. 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 views 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.
XOMA
CORPORATION |
CONDENSED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS |
(unaudited) |
(in thousands, except
per share amounts) |
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|
September 30, |
September 30, |
|
2015 |
2014 |
2015 |
2014 |
Revenues: |
|
|
|
|
License and collaborative
fees |
$ 645 |
$ 2,450 |
$ 1,852 |
$ 4,615 |
Contract and other |
1,429 |
2,686 |
5,412 |
9,903 |
Total revenues |
2,074 |
5,136 |
7,264 |
14,518 |
|
|
|
|
|
Operating expenses: |
|
|
|
|
Research and development |
17,559 |
20,235 |
57,255 |
61,371 |
Selling, general and
administrative |
5,632 |
5,354 |
15,913 |
15,768 |
Restructuring |
2,561 |
— |
2,561 |
84 |
Total operating expenses |
25,752 |
25,589 |
75,729 |
77,223 |
|
|
|
|
|
Loss from operations |
(23,678) |
(20,453) |
(68,465) |
(62,705) |
|
|
|
|
|
Other income (expense): |
|
|
|
|
Interest expense |
(1,030) |
(1,060) |
(3,152) |
(3,295) |
Other income (expense),
net |
(194) |
1,393 |
1,453 |
1,332 |
Revaluation of contingent
warrant liabilities |
24,422 |
5,721 |
24,206 |
33,685 |
Net loss |
$ (480) |
$ (14,399) |
$ (45,958) |
$ (30,983) |
|
|
|
|
|
Basic net loss per share of common stock |
$(0.00) |
$ (0.13) |
$ (0.39) |
$ (0.29) |
Diluted net loss per share of common
stock |
$(0.00) |
$ (0.17) |
$ (0.39) |
$ (0.55) |
Shares used in computing basic net loss per
share of common stock |
118,552 |
107,208 |
117,437 |
106,768 |
Shares used in computing diluted net loss per
share of common stock |
118,552 |
114,323 |
117,437 |
114,876 |
|
|
|
|
|
Other comprehensive loss: |
|
|
|
|
Net loss |
$ (480) |
$ (14,399) |
$ (45,958) |
$ (30,983) |
Net unrealized (loss) gain on
available-for-sale securities |
— |
(2) |
— |
5 |
Comprehensive loss |
$ (480) |
$ (14,401) |
$ (45,958) |
$ (30,978) |
|
|
|
XOMA CORPORATION |
|
|
CONDENSED CONSOLIDATED BALANCE
SHEETS |
|
|
(in thousands, except share and per
share amounts) |
|
|
|
|
|
|
September 30, |
December 31, |
|
2015 |
2014 |
|
(unaudited) |
|
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 32,046 |
$ 78,445 |
Trade and other receivables,
net |
39,343 |
3,309 |
Prepaid expenses and other
current assets |
2,878 |
1,859 |
Total current assets |
74,267 |
83,613 |
Property and equipment, net |
4,097 |
5,120 |
Other assets |
664 |
669 |
Total assets |
$ 79,028 |
$ 89,402 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
(DEFICIT) EQUITY |
|
|
Current liabilities: |
|
|
Accounts payable |
$ 5,665 |
$ 5,990 |
Accrued and other
liabilities |
9,680 |
9,892 |
Deferred revenue – current |
39,345 |
1,089 |
Interest bearing obligations –
current |
4,123 |
19,018 |
Accrued interest on interest
bearing obligations – current |
324 |
257 |
Total current liabilities |
59,137 |
36,246 |
Deferred revenue – long-term |
— |
1,939 |
Interest bearing obligations – long-term |
44,462 |
16,290 |
Contingent warrant liabilities |
4,070 |
31,828 |
Other liabilities - long term |
549 |
— |
Total liabilities |
108,218 |
86,303 |
|
|
|
|
|
|
Stockholders' (deficit) equity: |
|
|
Preferred stock, $0.05 par
value, 1,000,000 shares authorized, 0 issued and outstanding |
— |
— |
Common stock, $0.0075 par
value, 277,333,332 shares authorized, 118,796,332 and 115,892,450
shares issued and outstanding at September 30, 2015 and December
31, 2014, respectively |
891 |
869 |
Additional paid-in capital |
1,135,354 |
1,121,707 |
Accumulated deficit |
(1,165,435) |
(1,119,477) |
Total stockholders' (deficit)
equity |
(29,190) |
3,099 |
Total liabilities and
stockholders' (deficit) equity |
$ 79,028 |
$ 89,402 |
CONTACT: Company and Investor Contact:
Ashleigh Barreto
510-204-7482
barreto@xoma.com
Juliane Snowden
The Oratorium Group, LLC
jsnowden@oratoriumgroup.com
Media Contact:
Ryan Flinn
W2O Group
415-946-1059
rflinn@w2ogroup.com
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