On November 3, 2022 XOMA Corporation (Nasdaq: XOMA), a biotech royalty aggregator playing a distinctive role in helping biotech companies achieve their goal of advancing novel therapeutic candidates aimed at improving human health, reported its third quarter 2022 financial results and provided a recent operations update (Press release, Xoma, NOV 3, 2022, View Source [SID1234623004]).
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"The third quarter was a turning point for XOMA as a royalty and milestone aggregator. Less than one year after we acquired the 0.5% economic interest in VABYSMO sales, we have received our first commercial payment from Roche. The therapy is now available to retinal specialists and their patients in three important markets – the U.S., EU, and Japan," stated Jim Neal, Chairman and Chief Executive Officer of XOMA. "Separately, as a result of a monetization transaction we closed in 2021 with Kuros Biosciences associated with vidutolimod, which was being developed by Checkmate Pharmaceuticals, we received a $2.5 million payment as Regeneron completed its acquisition of Checkmate. We look forward to additional business and clinical milestone achievements from our partners as they advance their assets."
Financial Results
XOMA recorded total revenues of $0.5 million for the third quarter of 2022 and $0.9 million for the third quarter of 2021. The decrease for the three months ended September 30, 2022, as compared to the same period in 2021, was primarily due to $0.5 million of milestone revenue recognized in the third quarter of 2021 under XOMA’s license agreement with Compugen.
Research and development ("R&D") expenses were $29,000 and $30,000, respectively, for the third quarters of 2022 and 2021.
General and administrative ("G&A") expenses were $4.8 million for the third quarter of 2022, compared to $4.3 million for the third quarter of 2021. The additional $0.5 million during the third quarter of 2022 reflects increased consulting and legal expenses associated with deal costs.
In the third quarter of 2022, G&A expenses included $0.8 million in non-cash stock-based compensation expense, which was consistent with the third quarter of 2021. XOMA’s net cash used in operations in the third quarter of 2022 was $3.7 million, as compared with $3.1 million during the third quarter of 2021.
Other income, net was $0.2 million for the third quarter of 2022, compared to other expense, net of $1.1 million in the corresponding quarter of 2021. The fluctuation in other income (expense), net between the quarters ended September 30, 2022 and 2021, is primarily due to the change in the fair value of equity securities XOMA holds in Rezolute, Inc.
Net loss for the third quarter of 2022 was $4.2 million, compared to net loss of $4.4 million for the third quarter of 2021.
On September 30, 2022, XOMA had cash of $78.3 million. In August 2022, XOMA received a $0.5 million cash payment from Roche, representing the first commercial payment for XOMA’s 0.5% commercial interest in the sales of VABYSMO (faricimab-svoa). The payment was recorded in the Company’s condensed consolidated balance sheet as of September 30, 2022, as a reduction of long-term royalty and commercial payment receivables. On October 17, 2022, the Company paid cash dividends on the 8.625% Series A Cumulative Perpetual Preferred Stock (Nasdaq: XOMAP) equal to $0.53906 per share and cash dividends on the 8.375% Series B Cumulative Perpetual Preferred Stock (Nasdaq: XOMAO) equal to $0.52344 per depositary share. The Company ended December 31, 2021, with cash and restricted cash of $95.4 million. After paying its remaining debt obligations in the second quarter of 2021, XOMA has no debt on its balance sheet. The Company continues to believe its current cash position will be sufficient to fund XOMA’s operations for multiple years.