Xencor Announces Q2 2024 Financial Results

Xencor, Inc., a clinical-stage biopharmaceutical enterprise specializing in engineered antibodies for cancer and other severe ailments, has announced its financial outcomes for the second quarter, concluding June 30, 2024. The company also provided updates on recent business activities and internal clinical programs.

Bassil Dahiyat, Ph.D., the President and CEO of Xencor, expressed optimism regarding their clinical endeavors. He highlighted the company's focus on developing high-potential, first-in-class bispecific T-cell engagers and other XmAb® candidates. Dahiyat emphasized the expanding scope of engineered antibodies and bispecifics, which has inspired the advancement of various new XmAb candidates, with announcements of new candidates expected in the upcoming months.

Xencor is making notable progress in its clinical-stage T-cell engager programs. The dose-escalation studies of XmAb819 (ENPP3 x CD3) for clear cell renal cell carcinoma and XmAb808 (B7-H3 x CD28) for advanced solid tumors are on track to reach target dose levels by the year's end. Additionally, XmAb541 (CLDN6 x CD3) has commenced clinical studies with initial enrollments.

The company's bispecific antibody programs are achieving significant milestones:

- XmAb819 (ENPP3 x CD3): This bispecific T-cell engager, in Phase 1 clinical development, targets patients with advanced clear cell renal cell carcinoma. The XmAb 2+1 multivalent format enhances selectivity for ENPP3-expressing tumor cells while sparing normal cells. The study is progressing through dose-escalation cohorts, with target dose levels expected by the year's end.

- XmAb808 (B7-H3 x CD28): In Phase 1 clinical development, XmAb808 is being tested in combination with pembrolizumab for advanced solid tumors. It employs the XmAb 2+1 format to bind the tumor antigen B7-H3, providing necessary co-stimulation for T cells. The study is advancing through dose-escalation cohorts with target dose levels anticipated by year-end.

- XmAb541 (CLDN6 x CD3): This bispecific T-cell engager is in Phase 1 clinical development for advanced ovarian cancer and other solid tumors. XmAb541 uses the XmAb 2+1 format for increased selectivity towards cells expressing Claudin-6 over other Claudin family members, which may be present in normal tissues.

Another key candidate, Vudalimab (PD-1 x CTLA-4), a dual checkpoint inhibitor, is progressing in multiple clinical studies. These include monotherapy in metastatic castration-resistant prostate cancer (mCRPC), combination therapy with docetaxel for mCRPC, and combination therapy with chemotherapy for non-small cell lung cancer. A data update and a decision on advancing Vudalimab for mCRPC are expected in the first half of 2025.

From a business perspective, Xencor has regained exclusive global rights to Plamotamab (CD20 x CD3), a Phase 2-ready bispecific T-cell engager. The company has concluded Phase 1 studies of XmAb564 (IL2-Fc for autoimmune disease) and XmAb662 (IL12-Fc for solid tumors) in the first half of 2024.

Financially, Xencor anticipates concluding 2024 with $475 million to $525 million in cash, cash equivalents, and marketable debt securities, sufficient to fund operations into 2027.

For the second quarter of 2024, Xencor's cash and equivalents totaled $585 million, down from $697 million at the end of 2023. Revenues for the second quarter were $17 million, a decline from $45.5 million in the same period in 2023. This decrease was partly due to lower non-cash royalty revenue and reduced licensing revenue. For the first six months of 2024, revenues were $29.8 million, compared to $64.5 million for the same period in 2023.

Research and development (R&D) expenses for the second quarter were $61.5 million, slightly up from $60.1 million in 2023, due to increased spending on early-stage programs. However, R&D expenses for the first half of 2024 were $118.4 million, down from $125.6 million the previous year. General and administrative (G&A) expenses rose to $17.7 million in the second quarter from $11.5 million in 2023. For the first six months, G&A expenses were $31.5 million, up from $25.6 million, primarily due to increased corporate activities and stock-based compensation costs.

Other expenses for the second quarter were $(5.0) million, compared to $4.0 million in 2023, mainly due to losses from equity investments. For the first six months, other expenses were $(15.8) million, compared to $4.0 million in 2023, largely due to an impairment charge on an equity investment.

The net loss for the second quarter was $66.0 million, or $(1.07) per share, compared to a net loss of $22.0 million, or $(0.37) per share, in 2023. For the first half of 2024, the net loss was $134.0 million, or $(2.18) per share, compared to $82.7 million, or $(1.38) per share, for the same period in 2023.

As of June 30, 2024, Xencor had 61,766,054 outstanding shares, up from 60,600,060 a year earlier.

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