XOMA Royalty Reports First Quarter 2025 Financial Results and Highlights Business Achievements
Pipeline advancements: The Marketing Authorization Application $(MAA)$ for Day One Biopharmaceuticals and Ipsen's tovorafenib was accepted for review by the European Marketing Authority (EMA) and Takeda initiated its Phase 3 trial exploring mezagitamab for the treatment of chronic primary immune thrombocytopenia
Business development: Acquired an economic interest in Castle Creek Biosciences' D-Fi (FCX-007) through participation in a syndicated royalty financing transaction and successfully sold all unpartnered Kinnate assets
Cash receipts: Received $18.0 million in the first quarter of 2025 including $13.4 million in royalty receipts
EMERYVILLE, Calif. , May 13, 2025 (GLOBE NEWSWIRE) -- XOMA Royalty Corporation $(XOMA)$, the biotech royalty aggregator, reported its first quarter 2025 financial results and highlighted recent actions that have the potential to deliver shareholder value.
"We are committed to generating value for shareholders through prudent cash deployment, strict expense control, and opportunistic share repurchases. Our first quarter highlights included the progression of key pipeline assets, solid cash receipts, and an increase in our share repurchase activity," stated Owen Hughes, Chief Executive Officer of XOMA Royalty. "With accelerating royalty receipts and a robust pipeline, we believe a path to sustained cashflow generation is tangible."
Royalty and Milestone Acquisitions
Partner Asset and Transaction Detail
------------ -------------------------------------------------------------
Castle Creek XOMA Royalty added a royalty interest in D-Fi (FCX-007),
a Phase 3 asset being developed by Castle Creek Biosciences,
to the portfolio. D-Fi is being studied in dystrophic
epidermolysis bullosa (DEB), a rare progressive and
debilitating skin disorder. D-Fi has been granted
Orphan Drug Designation for the treatment of DEB,
as well as Rare Pediatric Disease, Fast Track, and
Regenerative Medicine Advanced Therapy designations
by the FDA.
XOMA Royalty contributed $5 million to Castle Creek
Biosciences' $75 million syndicated royalty financing
transaction.
Partner Updates through May 9, 2025
Partner Event
-------------------------- --------------------------------------------------
Rezolute In January, Rezolute received Breakthrough Therapy
Designation from FDA for ersodetug (RZ358) for the
treatment of hypoglycemia due to congenital
hyperinsulinism (cHI)(1) . In February, the
company announced the Independent Data Monitoring
Committee $(DMC.AU)$ reviewed the safety data from
eight infants ages 3 months to 1 year enrolled in
the open-label portion of the sunRIZE Phase 3
study of ersodetug for the treatment of
hypoglycemia due to cHI. Their conclusion was the
safety profile was such that infants may now be
enrolled in the double-blind, placebo-controlled
study(2) . In April, Rezolute announced the
Independent DMC recommended the sunRIZE Phase 3
trial continue as planned with no need to increase
sample size. Enrollment is on track and is
expected to be completed in May 2025. Topline data
is anticipated in December 2025.(3) In May, the
company announced the FDA has granted Breakthrough
Therapy Designation (BTD) to its investigational
therapy, ersodetug, for the treatment of
hypoglycemia caused by tumor HI.(4)
-------------------------- --------------------------------------------------
Affitech Research AS XOMA Royalty paid $6 million in milestones to
Affitech related to VABYSMO$(R)$ (faricimab-svoa)
achieving specific sales thresholds. This was the
final payment due to Affitech.
-------------------------- --------------------------------------------------
Daré Bioscience Announced its intention to make its Sildenafil
Cream, 3.6%, available by prescription under
Section 503B of the Food and Drug Cosmetic Act
while it pursues a parallel path to obtain FDA
approval. Daré anticipates Sildenafil Cream
will be available via one 503B-registered
outsourcing facility partner in the fourth quarter
of 2025.
-------------------------- --------------------------------------------------
Day One Biopharmaceuticals Ipsen, Day One's partner outside of the U.S.,
filed a Marketing Authorization Application (MMA)
with the European Medicines Agency for tovorafenib
as a treatment for pediatric low-grade glioma
(pLGG)(5) . XOMA Royalty earned a $4.0 million
milestone related to this filing.
-------------------------- --------------------------------------------------
Takeda The first patient was dosed in Takeda's Phase 3
clinical trial investigating mezagitamab as a
treatment for adults with chronic primary immune
thrombocytopenia $(ITP)$. This achievement triggered
a $3.0 million milestone payment, net, to XOMA
Royalty in the second quarter.
Partner Event
------- -----------------------------------------------------
Kinnate In early 2025, XOMA Royalty sold the five unpartnered
Kinnate assets to several parties. Per the terms of
the acquisition, a portion of any upfront payments
received by XOMA Royalty will be distributed to the
Kinnate CVR holders.
Anticipated 2025 Events of Note
Partner Event
-------------------------- --------------------------------------------------
Day One Biopharmaceuticals The European Medicines Agency (EMA) decision
regarding Day One's Marketing Authorization
Application (MAA) for tovorafenib, a treatment for
the most common childhood brain tumor, pediatric
low-grade glioma (pLGG).
-------------------------- --------------------------------------------------
Rezolute Completion of enrollment in sunRIZE Phase 3
clinical trial, which is investigating ersodetug
in infants and children with cHI. Topline data are
expected in December 2025(3) . First patient dosed
in the Phase 3 registrational study for ersodetug
for the treatment of hypoglycemia due to tumor
hyperinsulinism(6) .
-------------------------- --------------------------------------------------
Gossamer / Chiesi Presentation of topline results from the Phase 3
PROSERA study, a global registrational clinical
trial in patients with WHO Function Class II and
III pulmonary arterial hypertension (PAH).(7)
Initiation of a registrational Phase 3 study in
pulmonary hypertension associated with
interstitial lung disease (PH-ILD) in 2025.(1)
-------------------------- --------------------------------------------------
Daré Bioscience Successfully makes Sildenafil Cream available via
prescription in the fourth quarter of 2025 as a
compounded drug under Section 503B of the FDCA.
Commencement of one of two registrational Phase 3
clinical trials investigating Sildenafil Cream,
3.6%, for the treatment of female sexual arousal
disorder(8) .
-------------------------- --------------------------------------------------
First Quarter 2025 Financial Results
Tom Burns, Chief Financial Officer of XOMA Royalty, commented, "In the first quarter, we received $18 million in cash, $13.4 million from our partners' commercial sales and $4.6 million from milestones and fees. As our partners continue to execute well on their commercial product launch activities and we learn of new commercial opportunities within our portfolio, our line of sight on becoming cash flow positive on a consistent basis exclusively from the cash payments received from royalties grows clearer. With this outlook, we deployed $0.5 million to repurchase 25,828 shares of our common stock."
Income and Revenue: XOMA Royalty recorded total income and revenues of $15.9 million for the first quarter of 2025, compared to $1.5 million for the comparable period in 2024. The increase for the first quarter of 2025 was primarily driven by income recorded under the effective interest rate method related to VABYSMO(R) , a milestone of $4.0 million associated with Day One and Ipsen's MAA filing with the EMA, a $4.0 million payment related to our collaboration agreement with Takeda, and $1.5 million in estimated royalties related to OJEMDA$(TM)$.
Research and Development (R&D) Expenses: R&D expenses were $1.3 million in the first quarter of 2025, compared to $33,000 in the first quarter of 2024. The increase of approximately $1.3 million for the first quarter of 2025 was due to $1.0 million in pass-through licensing fees to an undisclosed licensor related to the Phase 3 milestone achieved by Takeda under our Takeda Collaboration Agreement, combined with clinical trial costs related to KIN-3248.
General and Administrative (G&A) Expenses: G&A expenses were $8.1 million in the first quarter of 2025, compared with $8.5 million for the same period in 2024. The decrease of $0.4 million was primarily due to a decrease of $0.9 million in stock compensation costs, partially offset by an increase in consulting costs of $0.5 million related to our Kinnate acquisition.
In the quarter ended March 31, 2025, G&A expenses included $2.0 million of non-cash stock-based compensation expenses, compared to $2.9 million in the first quarter of 2024. The $0.9 million difference between the two periods is primarily driven by the timing of expense recognition related to the performance stock unit grant awarded to Mr. Hughes in connection with his appointment as full-time CEO in January 2024.
Interest Expense: Interest expense was $3.5 million and $3.6 million for the first quarters of 2025 and 2024 respectively. Interest expense relates to the Blue Owl Loan established in December 2023.
Amortization of Intangible Assets: Amortization of intangible assets relates to the IP acquired in the Company's acquisition of Pulmokine in November 2024.
Other Income/Expense, net: The Company reported other expense, net, of $0.1 million in the first quarter of 2025, compared to other income, net, of $2.0 million in the comparable period of 2024. The reduction during the first quarter of 2025 was primarily driven by a decrease in the fair value of our investments in two public companies' equity securities and a decrease in investment income due to decreased balances and decreased market interest rates on XOMA Royalty's investments.
Net Income (Loss): Net income for the first quarter ended March 31, 2025, was $2.4 million, compared to a net loss of $8.6 million in the first quarter of 2024.
Cash: On March 31, 2025, XOMA Royalty had cash and cash equivalents of $95.0 million (including $4.8 million in restricted cash), compared with cash and cash equivalents of $106.4 million (including $4.8 million in restricted cash) on December 31, 2024. In the first quarter of 2025, XOMA Royalty received $18.0 million in cash receipts including $13.4 million in royalties and commercial payments and $4.6 million in milestones and fees. In the first quarter of 2025, XOMA Royalty deployed $5.0 million to acquire a new Phase 3 milestone and royalty asset, used $0.5 million to repurchase 25,828 shares, and paid $1.4 million in dividends on the XOMA Royalty Perpetual Preferred stocks.
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(R) (faricimab-svoa), OJEMDA(TM) (tovorafenib), MIPLYFFA(TM) (arimoclomol), XACIATO(TM) (clindamycin phosphate) vaginal gel 2%, IXINITY(R) [coagulation factor IX (recombinant)], DSUVIA(R) (sufentanil sublingual tablet), and Sildenafil Cream, 3.6%; the potential occurrences of the events listed under "Anticipated 2025 Events of Note"; the anticipated timings of regulatory filings and approvals related to assets in XOMA Royalty's portfolio; and the potential of XOMA Royalty's portfolio of partnered programs and licensed technologies generating substantial milestone and royalty proceeds over time. 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 Royalty'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; and 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. Other potential risks to XOMA Royalty meeting these expectations are described in more detail in XOMA Royalty's most recent filing on Form 10-Q and in other filings with the Securities and Exchange Commission. Consider such risks carefully when considering XOMA Royalty's prospects. Any forward-looking statement in this press release represents XOMA Royalty'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 Royalty 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, the commercial assets in XOMA Royalty's milestone and royalty portfolio are VABYSMO(R) (faricimab-svoa), OJEMDA(TM) (tovorafenib), MIPLYFFA(TM) (arimoclomol), XACIATO(TM) (clindamycin phosphate) vaginal gel 2%, IXINITY(R) [coagulation factor IX (recombinant)], and DSUVIA(R) (sufentanil sublingual tablet). All other assets in the milestone and royalty portfolio are investigational compounds. Efficacy and safety have not been established. There is no guarantee that any of the investigational compounds will become commercially available.
XOMA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except share and per share amounts)
Three Months Ended March 31,
2025 2024
Income and Revenues:
Income from purchased receivables
under the EIR method $ 6,070 $ -
Income from purchased receivables
under the cost recovery method 5,525 -
Revenue from contracts with
customers 4,000 1,000
Revenue recognized under
units-of-revenue method 317 490
Total income and revenues 15,912 1,490
----------- ----------
Operating expenses:
Research and development 1,293 33
General and administrative 8,146 8,461
Amortization of intangible assets 544 -
Total operating expenses 9,983 8,494
----------- ----------
Income (Loss) from operations 5,929 (7,004)
Other income (expense)
Interest expense (3,467) (3,551)
Other income (expense), net (95) 1,960
----------- ----------
Net income (loss) $ 2,367 $ (8,595)
=========== ==========
Net income (loss) available to
(attributable to) common
stockholders, basic $ 705 $ (9,963)
=========== ==========
Basic net income (loss) per share
available to (attributable to)
common stockholders $ 0.06 $ (0.86)
=========== ==========
Weighted average shares used in
computing basic net income (loss)
per share available to
(attributable) to common
stockholders 11,969 11,580
=========== ==========
Net income (loss) available to
(attributable to) common
stockholders, diluted $ 999 $ (9,963)
=========== ==========
Diluted net income (loss) per share
available to (attributable to)
common stockholders $ 0.06 $ (0.86)
=========== ==========
Weighted average shares used in
computing diluted net income (loss)
per share available to
(attributable) to common
stockholders 17,781 11,580
=========== ==========
XOMA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
March 31, December 31,
2025 2024
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $ 90,265 $ 101,654
Short-term restricted cash 1,410 1,330
Investment in equity securities 2,382 3,529
Trade and other receivables, net 5,544 1,839
Short-term royalty and commercial
payment receivables under the EIR
method 12,240 14,763
Short-term royalty and commercial
payment receivables under the cost
recovery method 413 413
Prepaid expenses and other current
assets 971 2,076
---------- ----------
Total current assets 113,225 125,604
Long-term restricted cash 3,352 3,432
Property and equipment, net 29 32
Operating lease right-of-use assets 304 319
Long-term royalty and commercial
payment receivables under the EIR
method 4,857 4,970
Long-term royalty and commercial
payment receivables under the cost
recovery method 59,916 55,936
Exarafenib milestone asset (Note 4) 3,307 3,214
Investment in warrants 605 -
Intangible assets, net 25,365 25,909
Other assets - long term 1,790 1,861
Total assets $ 212,750 $ 221,277
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,319 $ 1,053
Accrued and other liabilities 1,221 5,752
Contingent consideration under RPAs,
AAAs, and CPPAs - 3,000
Operating lease liabilities 459 446
Unearned revenue recognized under
units-of-revenue method 1,370 1,361
Preferred stock dividend accrual 1,368 1,368
Current portion of long-term debt 13,697 11,394
Total current liabilities 20,434 24,374
Unearned revenue recognized under
units-of-revenue method -- long-term 4,084 4,410
Exarafenib milestone contingent
consideration (Note 4) 3,307 3,214
Long-term operating lease liabilities 362 483
Long-term debt 99,934 106,875
Total liabilities 128,121 139,356
---------- ----------
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 as of March
31, 2025 and December 31, 2024 49 49
8.375% Series B cumulative, perpetual
preferred stock, 1,600 shares issued
and outstanding as of March 31, 2025
and December 31, 2024 -- --
Convertible preferred stock, 5,003
shares issued and outstanding as of
March 31, 2025 and December 31, 2024 -- --
Common stock, $0.0075 par value,
277,333,332 shares authorized,
11,952,889 and 11,952,377 shares
issued and outstanding as of March
31, 2025 and December 31, 2024,
respectively 90 90
Additional paid-in capital 1,319,607 1,318,766
Accumulated other comprehensive income 118 73
Accumulated deficit (1,235,235) (1,237,057)
---------- ----------
Total stockholders' equity 84,629 81,921
---------- ----------
Total liabilities and
stockholders' equity $ 212,750 $ 221,277
========== ==========
XOMA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
Three Months Ended March 31,
2025 2024
---------------------- ----------------------------
Cash flows from operating
activities:
Net income (loss) $ 2,367 $ (8,595)
Adjustments to
reconcile net income
(loss) to net cash
provided by (used in)
operating activities:
Adjustment for income
from EIR method
purchased
receivables 1,743 --
Stock-based
compensation
expense 1,983 2,856
Common stock
contribution to
401(k) 141 118
Amortization of
intangible assets 544 --
Depreciation 3 2
Accretion of
long-term debt
discount and debt
issuance costs 427 306
Non-cash lease
expense 17 14
Change in fair value
of equity
securities 1,147 (252)
Change in fair
value of
available-for-sale
debt securities
classified as cash
equivalents 45 --
Changes in assets
and liabilities:
Trade and other
receivables, net (3,705) 1,001
Prepaid expenses
and other assets 1,176 213
Accounts payable
and accrued
liabilities (3,265) (105)
Operating lease
liabilities (108) (15)
Unearned revenue
recognized under
units-of-revenue
method (317) (490)
-------------------- ---- -------------------
Net cash provided
by (used in)
operating
activities 2,198 (4,947)
-------------------- ---- -------------------
Cash flows from investing
activities:
Payments of
consideration under
RPAs, AAAs and CPPAs (8,000) (15,000)
Receipts under RPAs,
AAAs and CPPAs 1,307 7,771
Purchase of property
and equipment -- (17)
Net cash used in
investing
activities (6,693) (7,246)
-------------------- ---- -------------------
Cash flows from financing
activities:
Principal payments --
debt (5,066) (3,616)
Debt issuance costs and
loan fees paid in
connection with
long-term debt -- $(581.SI)$
Payment of preferred
stock dividends (1,368) (1,368)
Repurchases of common
stock (545) (13)
Proceeds from exercise
of options and other
share-based
compensation 325 1,956
Taxes paid related to
net share settlement
of equity awards (240) (1,334)
Net cash used in
financing
activities (6,894) (4,956)
-------------------- ---- -------------------
Net decrease in cash,
cash equivalents and
restricted cash (11,389) (17,149)
Cash, cash equivalents
and restricted cash at
the beginning of the
period 106,416 159,550
Cash, cash equivalents
and restricted cash at
the end of the period $ 95,027 $ 142,401
==================== ==== ===================
Supplemental Cash Flow
Information:
Cash paid for interest $ 6,078 $ 3,780
Cash paid for taxes $ 277 $ --
Non-cash investing and
financing activities:
Accrual of contingent
consideration under
the Affitech CPPA $ -- $ 3,000
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
(1) https://ir.rezolutebio.com/news/detail/345/rezolute-receives-breakthrough-therapy-designation-from-fda-for-ersodetug-in-the-treatment-of-hypoglycemia-due-to-congenital-hyperinsulinism
(2) https://ir.rezolutebio.com/news/detail/347/rezolute-provides-update-on-its-phase-3-sunrize-study-of-ersodetug-for-the-treatment-of-hypoglycemia-due-to-congenital-hyperinsulinism
(3) https://ir.rezolutebio.com/news/detail/350/rezolute-announces-positive-recommendation-after-independent-interim-analysis-of-phase-3-sunrize-study-of-ersodetug-in-congenital-hyperinsulinism-hi
(4) https://ir.rezolutebio.com/news/detail/354/rezolute-receives-breakthrough-therapy-designation-from-fda-for-ersodetug-in-the-treatment-of-hypoglycemia-due-to-tumor-hyperinsulinism
(5) https://ir.dayonebio.com/news-releases/news-release-details/day-one-reports-first-quarter-2025-financial-results-and
(6) 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
(7) https://ir.gossamerbio.com/news-releases/news-release-details/gossamer-bio-announces-fourth-quarter-and-full-year-2024
(8) https://ir.darebioscience.com/news-releases/news-release-details/dare-bioscience-announces-phase-3-plans-sildenafil-cream-36
(END) Dow Jones Newswires
May 13, 2025 07:30 ET (11:30 GMT)
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