Xencor Reports Fourth Quarter and Full Year 2023 Financial Results
- Xencor focuses on advancing XmAb CD3 and CD28 T-cell engagers and vudalimab for cancer treatment.
- The company received over $325 million in proceeds from royalty monetization and milestone payments in 2023.
- Early clinical data shows vudalimab monotherapy is generally well tolerated and has encouraging clinical benefit for high-risk mCRPC patients.
- Xencor plans to advance vudalimab in mCRPC and NSCLC studies, along with other bispecific antibody programs in 2024.
- The company reduced its workforce by 10% in January 2024 to align resources with clinical development focus.
- Xencor expects to end 2024 with $475 million to $525 million in cash to fund R&D programs and operations into 2027.
- None.
Insights
The recent clinical development updates from Xencor, Inc. regarding their engineered antibodies, particularly vudalimab, present several points of interest from a medical research perspective. Vudalimab, a dual checkpoint inhibitor targeting PD-1 and CTLA-4, is part of a growing class of cancer immunotherapies designed to enhance the immune system's ability to fight cancer. The reported objective response rate of 33% and the PSA90 in 25% of evaluable patients in the Phase 2 monotherapy study for high-risk mCRPC, while preliminary, are promising. These figures suggest potential efficacy in a patient population with limited treatment options after standard therapies have failed.
Furthermore, the tolerability profile is critical, noting that the most common immune-related adverse events were rash and ALT increases, with a single Grade 5 event of autoimmune hepatitis reported. It is important to monitor the long-term safety profile as the patient cohort grows and treatment duration extends. The therapeutic landscape for mCRPC is competitive, with a strong emphasis on improving survival and quality of life and the results from vudalimab's trials will need to be contextualized against existing treatments such as enzalutamide and abiraterone.
From a financial standpoint, Xencor's strong balance sheet, with a significant increase in cash and marketable securities year-over-year, is indicative of robust financial health and the ability to fund ongoing research and development. The reported net loss for the fourth quarter and full year of 2023 has widened compared to the previous year, which is attributable to increased R&D spending. This is a common scenario for clinical-stage biopharmaceutical companies, where investment in product development precedes revenue generation from marketed products.
Investors should note the revenue derived from milestone payments and royalties, signifying progress in collaborations and the potential for future income streams. However, the reliance on milestone payments can introduce volatility into revenue streams, as they are contingent on clinical and regulatory successes. The guidance provided, projecting cash sufficiency into 2027, offers a runway for the company's clinical programs but should be weighed against the high costs of advancing clinical trials and potential commercialization efforts.
Analyzing the market implications of Xencor's clinical updates requires understanding the competitive landscape of cancer immunotherapy. The focus on T cell engagers and checkpoint inhibitors aligns with current industry trends toward precision medicine and immunotherapy. The market for mCRPC treatments is evolving, with a need for therapies that can deliver results in later lines of treatment. Vudalimab's progress in clinical trials positions Xencor in a niche yet urgent segment of the oncology market.
The strategic decision to narrow the clinical program focus and reduce workforce indicates a streamlined approach to resource allocation, which could enhance operational efficiency. However, it also underscores the risks inherent in a pipeline-dependent on a small number of high-stakes programs. Market reception to these developments will likely hinge on continued positive clinical results and the strategic execution of the company's narrowed focus.
-- Clinical development focus on high-potential XmAb® T cell engagers and selective dual checkpoint inhibitor, vudalimab --
-- Vudalimab (PD-1 x CTLA-4) monotherapy generally well tolerated with encouraging clinical benefit for patients with high-risk mCRPC who have advanced beyond standard of care therapy --
-- Management to Host Conference Call at 4:30 p.m. ET Today --
“We begin 2024 with a focus on advancing our high-potential XmAb CD3 and CD28 T-cell engagers for the treatment of patients with solid tumors and the evaluation of our PD-1 x CTLA-4 dual checkpoint inhibitor, vudalimab, in patients with metastatic castration-resistant prostate cancer and front-line non-small cell lung cancer,” said Bassil Dahiyat, Ph.D., president and chief executive officer of Xencor. “This focused pipeline is supported by our strong financial foundation. In 2023, we significantly strengthened our balance sheet with our partial royalty monetization and milestone payments and royalties from our partners, for which we received more than
“The growing validation of T-cell engagers in solid tumors has encouraged us to build a range of new XmAb bispecific T-cell engager candidates, and we plan to select our next candidate for clinical development this year.”
Vudalimab (PD-1 x CTLA-4) Monotherapy in Patients with High-Risk mCRPC
Xencor is advancing vudalimab, a selective dual checkpoint inhibitor, in multiple clinical studies, including a Phase 2 monotherapy study (Study XmAb717-05) in patients with clinically defined high-risk metastatic castration-resistant prostate cancer (mCRPC). Early data from the study indicates that vudalimab has been generally well tolerated and associated with response to treatment in multiple patients who have visceral or lymph node metastases.
At the February 7, 2024 data cut off, 14 patients with clinically defined high-risk mCRPC had been treated with vudalimab every three weeks at a flat dose of 1000 mg, or 1200 mg for patients greater than 80 kg. Patients were a median of 72 years old and were heavily pretreated, having a median of four lines of prior therapy.
The efficacy-evaluable population included 12 patients who had baseline and at least one post-baseline RECIST assessment. The objective response rate was
The safety analysis included all 14 patients. The most common immune-related adverse events of any grade were rash (
Additional Vudalimab Clinical Studies and 2024 Priorities
Enrollment of patients with mCRPC in the study of vudalimab in combination with chemotherapy (Study XmAb717-04) is ongoing; revised chemotherapy dosing regimens are being evaluated, as previously disclosed.
In the fourth quarter of 2023, the Company dosed the first patient in a Phase 1b/2 study (Study XmAb717-06) evaluating vudalimab as a first-line treatment in patients with locally advanced or metastatic non-small cell lung cancer (NSCLC).
Xencor plans to:
- Continue enrollment and provide a data update and decision whether to advance vudalimab as a monotherapy for patients with mCRPC in the first half of 2025.
- Continue enrollment and provide a data update and decision whether to advance vudalimab in combination with chemotherapy for patients with mCRPC in the first half of 2025.
- Continue to enroll the Phase 1b part of a study of vudalimab in front-line metastatic NSCLC.
Additional Program Highlights and 2024 Priorities
-
XmAb819 (ENPP3 x CD3): XmAb819 is a bispecific antibody in Phase 1 clinical development for patients with advanced clear-cell renal cell carcinoma (ccRCC). XmAb819 is designed to engage the immune system, activating T cells for highly potent and targeted killing of tumor cells expressing ENPP3, an antigen highly expressed on kidney cancers. Xencor’s XmAb 2+1 multivalent format used in XmAb819 enables greater selectivity of ENPP3-expressing tumor cells compared to normal cells, which express lower levels of ENPP3. During 2024, Xencor plans to advance the ongoing Phase 1 dose-escalation study toward target dose levels.
-
XmAb808 (B7-H3 x CD28): XmAb808 is a tumor-selective, co-stimulatory CD28 bispecific antibody in Phase 1 clinical development. XmAb808 binds to the broadly expressed tumor antigen B7-H3 and is constructed with the XmAb 2+1 format. Co-stimulation is required for T cells to achieve full activation, and targeted CD28 bispecific antibodies may provide conditional co-stimulation of T cells when the antibodies are bound to tumor cells. During 2024, Xencor plans to advance the ongoing Phase 1 dose-escalation study toward target dose levels.
-
XmAb541 (CLDN6 x CD3): XmAb541 is a bispecific antibody being developed for patients with advanced ovarian cancer and other solid tumor types. XmAb541 is designed to engage the immune system, activating T cells for highly potent and targeted killing of tumor cells expressing Claudin-6 (CLDN6), a tumor-associated antigen. Xencor’s XmAb 2+1 multivalent format used in XmAb541 enables greater selectivity for cells expressing CLDN6 over similarly structured Claudin family members, which may be expressed on normal tissue. During the first half of 2024, Xencor plans to dose the first patient in a Phase 1 dose-escalation study.
- Engineered Cytokines: Xencor has been conducting Phase 1 studies evaluating engineered cytokines XmAb564 (IL2-Fc in autoimmune disease) and XmAb662 (IL12-Fc in solid tumors). In the first half of 2024, Xencor plans to conclude studies of XmAb564 and XmAb662, complete internal data packages, and pause further development of both programs until after assessments of future data from competitor programs in this class and safety and biomarker data from Xencor’s studies.
Recent Partnership Developments
-
Janssen Biotech, Inc., a Johnson & Johnson Company: JNJ-9401 (PSMA x CD28) and JNJ-1493 (CD20 x CD28) are clinical-stage XmAb bispecific antibodies that J&J is developing for patients with prostate cancer and B-cell malignancies, respectively. Both programs entered Phase 1 clinical development during the fourth quarter of 2023, and Xencor received
$20 million $7.5 million
Corporate Update: In January 2024, Xencor reduced its workforce to align resources with the company’s clinical development focus on high potential T cell engaging bispecific antibodies and a more narrowly defined clinical program to evaluate vudalimab. The workforce reductions affected approximately
Financial Guidance: Based on current operating plans, Xencor expects to end 2024 with between
Financial Results for the Fourth Quarter and Full Year Ended December 31, 2023
Cash, cash equivalents, and marketable debt securities totaled
Total revenue for the fourth quarter ended December 31, 2023 was
Research and development (R&D) expenses for the fourth quarter ended December 31, 2023 were
General and administrative (G&A) expenses for the fourth quarter ended December 31, 2023 were
Other income for the fourth quarter ended December 31, 2023 was
Non-cash, stock-based compensation expense for the full year ended December 31, 2023 was
Net loss for the fourth quarter ended December 31, 2023 was
The total shares outstanding were 60,998,191 as of December 31, 2023, compared to 59,997,713 as of December 31, 2022.
Conference Call and Webcast
Xencor will host a conference call and webcast today at 4:30 p.m. ET (1:30 p.m. PT) to discuss the financial results, provide a corporate update and review the clinical update of vudalimab monotherapy in mCRPC.
The live webcast may be accessed through “Events & Presentations” in the Investors section of the Company’s website, located at investors.xencor.com. Telephone participants may register to receive a dial-in number and unique passcode that can be used to access the call. A recording will be available for at least 30 days.
About Xencor
Xencor is a clinical-stage biopharmaceutical company developing engineered antibodies for the treatment of patients with cancer and other serious diseases. More than 20 candidates engineered with Xencor's XmAb® technology are in clinical development, and three XmAb medicines are marketed by partners. Xencor's XmAb engineering technology enables small changes to a proteins structure that result in new mechanisms of therapeutic action. For more information, please visit www.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 planned presentations of clinical data, planned clinical trials, projected financial resources, the quotations from Xencor's president and chief 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 of Xencor and 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 in Xencor's public securities filings. For a discussion of these and other factors, please refer to Xencor's annual report on Form 10-K for the year ended December 31, 2023 as well as Xencor's subsequent filings with the Securities 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 and Xencor undertakes 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 Sheets Data | |||||
| (in thousands, except share and per share data) | |||||
| December 31, | |||||
2023 |
2022 |
||||
| Cash, cash equivalents and marketable debt securities - current | $ |
551,515 |
$ |
580,631 |
|
| Other current assets |
|
71,645 |
|
94,711 |
|
| Marketable debt securities - long term |
|
145,892 |
|
3,826 |
|
| Other long-term assets |
|
183,640 |
|
167,098 |
|
| Total assets | $ |
952,692 |
$ |
846,266 |
|
| Total current liabilities |
|
84,709 |
|
63,844 |
|
| Deferred income - long term |
|
125,183 |
|
— |
|
| Other long term liabilities |
|
73,667 |
|
54,926 |
|
| Total liabilities |
|
283,559 |
|
118,770 |
|
| Total stockholders' equity |
|
669,133 |
|
727,496 |
|
| Total liabilities and stockholders’ equity | $ |
952,692 |
$ |
846,266 |
|
| Xencor, Inc. | ||||||||
| Consolidated Statements of Loss | ||||||||
| (in thousands, except share and per share data) | ||||||||
| Three months Ended December 31, | Year ended December 31, | |||||||
2023 |
2022 |
2023 |
2022 |
|||||
| (Unaudited) | ||||||||
| Revenue | $ |
44,689 |
$ |
21,610 |
$ |
168,338 |
$ |
164,579 |
| Operating expenses | ||||||||
| Research and development |
|
63,046 |
|
51,452 |
|
253,598 |
|
199,563 |
| General and administrative |
|
15,272 |
|
12,751 |
|
53,379 |
|
47,489 |
| Total operating expenses |
|
78,318 |
|
64,203 |
|
306,977 |
|
247,052 |
| Loss from operations |
|
(33,629) |
|
(42,593) |
|
(138,639) |
|
(82,473) |
| Other income, net |
|
20,177 |
|
30,136 |
|
18,200 |
|
27,965 |
| Loss before income tax |
|
(13,452) |
|
(12,457) |
|
(120,439) |
|
(54,508) |
| Income tax expense |
|
5,811 |
|
(415) |
|
5,811 |
|
673 |
| Net loss |
|
(19,263) |
|
(12,042) |
|
(126,250) |
|
(55,181) |
| Net loss attributable to non-controlling interest |
|
(163) |
|
— |
|
(163) |
|
— |
| Net loss attributable to Xencor, Inc. |
|
(19,100) |
|
(12,042) |
|
(126,087) |
|
(55,181) |
| Other comprehensive income (loss): | ||||||||
| Net unrealized gain (loss) on marketable debt securities available-for-sale |
|
1,999 |
|
2,924 |
|
8,243 |
|
(5,442) |
| Comprehensive loss attributable to Xencor, Inc. | $ |
(17,101) |
$ |
(9,118) |
$ |
(117,844) |
$ |
(60,623) |
| Net loss per common share attributable to Xencor, Inc.: | ||||||||
| Basic and Diluted | $ |
(0.31) |
$ |
(0.20) |
$ |
(2.08) |
$ |
(0.93) |
| Weighted average common shares used to compute net loss per share attributable to Xencor, Inc. | ||||||||
| Basic and Diluted |
|
60,847,854 |
|
59,912,038 |
|
60,503,283 |
|
59,652,461 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240227574864/en/
For Investors:
Charles Liles
cliles@xencor.com
(626) 737-8118
For Media:
Jason I. Spark
Evoke Canale
jason.spark@evokegroup.com
(619) 849-6005
Source: Xencor, Inc.
FAQ
What is Xencor focusing on in 2024?
What were the financial results for Xencor in Q4 and full year 2023?
What are the key highlights of vudalimab clinical data for high-risk mCRPC patients?
What are Xencor's priorities for vudalimab in 2024?
What partnership developments did Xencor have in 2023?
How did Xencor manage its workforce in January 2024?
What is Xencor's financial guidance for the end of 2024?
