Gravity Analytica

Xencor Reports Third Quarter 2024 Financial Results

XNCR 11.06.2024

SERA-AI Powered Highlights

Drug:XmAb-942 XmAb942

Drug:plamotamab plamotamab

Drug:XmAb-808 XmAb808

Drug:XmAb-819 XmAb819

Diseases:inflammatory bowel disease

Diseases:autoimmune diseases

Diseases:prostate cancer

Diseases:advanced clear cell renal cell carcinoma

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PASADENA, Calif.--(BUSINESS WIRE)--Nov. 6, 2024--Xencor, Inc.(NASDAQ:XNCR), a clinical-stage biopharmaceutical company developing engineered antibodies for the treatment of cancer and other serious diseases, today reported financial results for the third quarter endedSeptember 30, 2024and provided a review of recent business and clinical-stage program updates.

“In September, we provided updates across our clinical pipeline of XmAb® bispecific T-cell engagers in oncology and introduced our new autoimmune programs, including the B-cell depleting bispecific antibodies plamotamab and XmAb657, and XmAb942, our high potency anti-TL1A antibody with extended half-life in development for patients with inflammatory bowel disease. This week, we announced that XmAb942 advanced into a Phase 1 dose-escalation study in healthy volunteers,” saidBassil Dahiyat, Ph.D., president and chief executive officer atXencor. “We have been rebalancing our broad portfolio to focus on programs that leverage our protein engineering strengths and reduce exposure to biological uncertainties to increase our overall opportunities for clinical success. We also remain highly encouraged by our partner Amgen’s progress with developing xaluritamig, a STEAP1 x CD3 XmAb T-cell engager for patients with prostate cancer, which Amgen announced is starting a Phase 3 study later this year.”

Recent Corporate Activities

New XmAb Drug Candidates in Autoimmune Disease: InSeptember 2024,Xencorannounced new clinical development plansfor plamotamab (CD20 x CD3) andannounced new XmAb drug candidatesto be evaluated for the treatment of patients with autoimmune and inflammatory diseases. Plamotamab and XmAb657 (CD19 x CD3) could potentially address significant unmet needs for patients with a wide-range of autoimmune diseases that could be responsive to targeted B-cell depletion. XmAb942 (XtendTM anti-TL1A) and a drug candidate to potentially emerge from the XmAb TL1A x IL-23 program could address significant unmet medical needs for patients with inflammatory bowel disease (IBD), such as Crohn’s disease and ulcerative colitis, the two most common forms of IBD.

Public Offering Raised$201.3 Millionin Gross Proceeds:OnSeptember 12, 2024,Xencorannounced the closing of an underwritten public offering of common stock and pre-funded warrants, and the gross proceeds toXencorfrom the offering were$201.3 million, before deducting underwriting discounts and commissions and offering expenses.

Internal Clinical-Stage Program Updates

XmAb942 (Xtend anti-TL1A):In the fourth quarter of 2024,preclinical datawere presented during United European Gastroenterology (UEG) Week and a Phase 1 first-in-human study was initiated andbegan dosing healthy volunteers. XmAb942 is a high-potency, extended half-life, investigational anti-TL1A antibody in development for patients with IBD.Xencorexpects to present initial data from the single-ascending dose portion of the Phase 1 study in the first half of 2025.

Plamotamab (CD20 x CD3):Xencorpreviously completed a Phase 1 clinical study of plamotamab in hematologic cancers. Data from subcutaneous dosing cohorts in patients with relapsed or refractory non-Hodgkin’s lymphoma will be presented at the 66thAmerican Society of HematologyAnnual Meeting in a poster titled “First Presentation ofSubcutaneous Administrationin a Phase 1 Dose Escalation Study in Heavily Pretreated R/R NHL Patients Who Had Prior CAR-T Cell Therapy.”

InSeptember 2024,Xencorpresented results from the study showing favorable tolerability and comparable preliminary efficacy data, when cross compared to results from studies of a competitor molecule within the class and with similar patient baseline characteristics. Based on these clinical outcomes, deep and durable B-cell depletion observed in preclinical studies, and the emergent biology supportive of B-cell targeted T cell engagers for the treatment of patients with autoimmune diseases,Xencorplans to evaluate plamotamab in rheumatoid arthritis, in which patients have progressed through prior standard-of-care treatment.Xencorplans to initiate a Phase 1b/2a proof-of-concept study in the first half of 2025.

XmAb808 (B7-H3 x CD28):In the ongoing Phase 1 study’s highest dose cohort to date, within the range of expected active doses, two patients experienced dose-limiting toxicities as defined in the study protocol. One patient experienced an infusion-related reaction during administration of the first dose of XmAb808. A second patient experienced immune-related hepatitis with Grade 4 elevation of transaminases and Grade 3 elevation of bilirubin, after the second dose. The patient with liver toxicity was asymptomatic, and the laboratory abnormalities are resolving. The maximum tolerated dose has not been defined per protocol. As the data from these recent events are analyzed, back-fill enrollment is proceeding in the next lower dose cohort, a dose within the range of target doses, which was determined to be tolerable.Xencoranticipates that dose escalation will continue per protocol if the currently enrolling cohort continues to be tolerable.

InSeptember 2024,Xencorannounced that most patients enrolled into the Phase 1 dose-escalation study were men with metastatic castration-resistant prostate cancer (mCRPC), and in this group, prostate specific antigen (PSA) declines had been observed during the four-week monotherapy safety run-in period.Xencorplans to provide a clinical update around initiation of dose expansion cohorts during the first half of 2025.

XmAb819 (ENPP3 x CD3):InSeptember 2024,Xencorannounced that initial evidence of anti-tumor activity was observed in the ongoing Phase 1 dose-escalation study in patients with advanced clear cell renal cell carcinoma, including RECIST responses, and the duration of treatment for several patients in earlier dose cohorts had extended beyond one year. Cytokine release syndrome remained manageable, no maximum tolerated dose had been reached and the tolerability profile from recent dose cohorts supported continued dose escalation toward target dose levels.Xencorcontinues to anticipate reaching target dose levels by year end and plans to provide a clinical update around initiation of the first dose expansion cohort during the first half of 2025.

Collaboration Partner Amgen’s Xaluritamig Advancing into Phase 3 Development

Results from a Phase 1 study evaluating xaluritamig, a first-in-class STEAP1 x CD3 XmAb 2+1 bispecific T-cell engager, in patients with mCRPC were presented at theEuropean Society for Medical Oncology (ESMO) CongressinSeptember 2024. With a median follow-up time of 27.9 months, the median overall survival (OS) was 17.7 months across all cohorts. A PSA90 rate of 45.1% was also observed in high-dose cohorts, and PSA90 response was associated with survival (p = 0.0044), which Amgen believes could potentially serve as an early indicator for benefit in these patients. Amgen has indicated that a Phase 3 study in patients with post-taxane mCRPC will be initiated in the fourth quarter of 2024. Multiple Phase 1 studies evaluating xaluritamig as a monotherapy or in combination are enrolling patients with earlier prostate cancer.

Financial Results for the Third Quarter EndedSeptember 30, 2024

Cash, cash equivalents and marketable debt securities totaled$754.3 millionas ofSeptember 30, 2024, compared to$697.0 millionas ofDecember 31, 2023. Net proceeds from Xencor’sSeptember 2024underwritten public offering were$189.2 million.

Revenues for the third quarter endedSeptember 30, 2024were$10.7 million, compared to$59.2 millionfor the same period in 2023. Revenues earned in the third quarter of 2024 were primarily non-cash royalty revenue from Alexion and Incyte, compared to the same period in 2023, which were primarily royalty and milestone revenue from Alexion and milestone revenue from Janssen, Gilead and Omeros.

Research and development (R&D) expenses for the third quarter endedSeptember 30, 2024were$58.2 million, compared to$64.9 millionfor the same period in 2023. Decreased R&D spending for the third quarter of 2024 compared to 2023 is primarily due to decreased spending on wind down costs of terminated programs, partially offset by increased spending on programs such as XmAb942, XmAb819 and plamotamab.

General and administrative (G&A) expenses for the third quarter endedSeptember 30, 2024were$14.8 million, compared to$12.5 millionfor the same period in 2023. Increased G&A spending for the third quarter of 2024 compared to 2023 is primarily due to increased spending on professional fees.

Other income, net, for the third quarter endedSeptember 30, 2024was$16.0 million, compared to other expense, net of$6.0 millionfor the same period in 2023. Other income, net, for the third quarter of 2024, compared to other expense, net, for the same period in 2023, is primarily due to unrealized and realized gains from the change in fair value and sale of equity investments and interest income from investments.

Net loss attributable toXencorfor the third quarter endedSeptember 30, 2024was$45.1 million, or$(0.71)on a fully diluted per share basis, compared to net loss of$24.3 million, or$(0.40)on a fully diluted per share basis, for the same period in 2023.

Financial Guidance

Based on current operating plans,Xencorexpects to end 2024 with between$690 millionand$710 millionin cash, cash equivalents and marketable debt securities, and to have cash to fund research and development programs and operations into 2028.

AboutXencor

Xencoris a clinical-stage biopharmaceutical company developing engineered antibodies for the treatment of patients with cancer and other serious diseases. More than 20 candidates engineered withXencor'sXmAb® technology are in clinical development, and multiple XmAb medicines are marketed by partners.Xencor'sXmAb engineering technology enables small changes to a protein’s structure that result in new mechanisms of therapeutic action. For more information, please visitwww.xencor.com.

Forward-Looking Statements

Certain statements contained in this press release may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements include statements that are not purely statements of historical fact, and can generally be identified by the use of words such as “potential,” “can,” “will,” “plan,” “may,” “could,” “would,” “expect,” “anticipate,” “seek,” “look forward,” “believe,” “committed,” “investigational,” and similar terms, or by express or implied discussions relating to Xencor’s business, including, but not limited to, statements regarding statements regarding expectations for clinical progress, planned receipt and presentations of clinical data, including timing thereof, new XmAb candidates and programs, planned and ongoing clinical trials, projected financial resources and financial guidance, including estimated cash at year end and cash runway, the quotations fromXencor'schief executive officer, and other statements that are not purely statements of historical fact. Such statements are made on the basis of the current beliefs, expectations, and assumptions of the management ofXencorand are subject to significant known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements and the timing of events to be materially different from those implied by such statements, and therefore these statements should not be read as guarantees of future performance or results. Such risks include, without limitation, the risks associated with the process of discovering, developing, manufacturing and commercializing drugs that are safe and effective for use as human therapeutics and other risks, including the ability of publicly disclosed preliminary clinical trial data to support continued clinical development and regulatory approval for specific treatments, in each case as described inXencor'spublic securities filings. For a discussion of these and other factors, please refer toXencor'sannual report on Form 10-K for the year endedDecember 31, 2023as well asXencor'ssubsequent filings with theSecurities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended to date. All forward-looking statements are qualified in their entirety by this cautionary statement andXencorundertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof, except as required by law.

Xencor, Inc.
Selected Consolidated Balance Sheet Data
(in thousands)

	September 30,		December 31,
	2024		2023
	(Unaudited)
Cash, cash equivalents and marketable debt securities - current	$	464,074	$	551,515
Other current assets		109,254		71,645
Marketable debt securities - long term		290,274		145,512
Other long-term assets		120,033		184,020
Total assets	$	983,635	$	952,692

Total current liabilities		91,972		84,709
Deferred income - long term		94,107		125,183
Other long term liabilities		76,658		73,667
Total liabilities		262,737		283,559
Total stockholders' equity		720,898		669,133
Total liabilities and stockholders’ equity	$	983,635	$	952,692

Xencor, Inc.
Consolidated Statements of Comprehensive Loss
(in thousands, except share and per share data)

	Three Months EndedSeptember 30,						Nine Months EndedSeptember 30,
	2024			2023			2024			2023
	(Unaudited)
Revenue	$	10,710		$	59,164		$	40,475		$	123,649

Operating expenses
Research and development		58,226			64,941			176,630			190,553
General and administrative		14,767			12,493			46,300			38,107
Total operating expenses		72,993			77,434			222,930			228,660
Loss from operations		(62,283	)		(18,270	)		(182,455	)		(105,011	)

Other income (expense), net		15,986			(5,999	)		158			(1,975	)
Loss before income tax		(46,297	)		(24,269	)		(182,297	)		(106,986	)

Income tax expense		—			—			117			—
Net loss		(46,297	)		(24,269	)		(182,414	)		(106,986	)

Net loss attributable to non-controlling interest		(1,154	)		—			(3,275	)		—
Net loss attributable toXencor, Inc.		(45,143	)		(24,269	)		(179,139	)		(106,986	)

Other comprehensive income
Net unrealized gain on marketable debt securities		2,452			1,151			510			6,244
Comprehensive loss attributable toXencor, Inc.	$	(42,691	)	$	(23,118	)	$	(178,629	)	$	(100,742	)

Net loss per common share attributable toXencor, Inc.:
Basic and Diluted	$	(0.71	)	$	(0.40	)	$	(2.87	)	$	(1.77	)
Weighted average common shares used to compute net loss per share attributable toXencor, Inc.
Basic and Diluted		64,022,547			60,621,534			62,310,045			60,387,163

View source version onbusinesswire.com:https://www.businesswire.com/news/home/20241106077662/en/

For Investors:Charles Lilescliles@xencor.com(626) 737-8118

For Media:Cassidy McClainInizio Evokecassidy.mcclain@inizioevoke.com(619) 694-6291

Source:Xencor, Inc.

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