Core Viewpoint - Xencor reported a quarterly loss of $0.66 per share, slightly worse than the Zacks Consensus Estimate of a loss of $0.63, but an improvement from a loss of $1.11 per share a year ago [1][2] Financial Performance - The company posted revenues of $32.73 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 48.38% and significantly up from $12.81 million in the same quarter last year [3] - Xencor has surpassed consensus revenue estimates three times over the last four quarters [3] Stock Performance - Xencor shares have declined approximately 63.2% since the beginning of the year, contrasting with the S&P 500's decline of 4.7% [4] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [7] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.67 on revenues of $18.77 million, and for the current fiscal year, it is -$2.92 on revenues of $81.09 million [8] - The trend of estimate revisions for Xencor is mixed, which could change following the recent earnings report [7] Industry Context - The Medical - Drugs industry, to which Xencor belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [9]

PART I. FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Xencor reported Q1 2025 revenues of $32.7 million and a net loss of $48.4 million, a significant improvement from the prior year, with total assets at $904.7 million [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to $904.7 million as of March 31, 2025, primarily due to reduced marketable debt securities, while liabilities and equity also declined Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $39,675 | $40,875 | | Marketable debt securities (current & long-term) | $653,836 | $665,804 | | Total assets | $904,689 | $951,945 | | **Liabilities & Equity** | | | | Total liabilities | $264,815 | $277,919 | | Liabilities related to sales of future royalties | $154,379 | $163,606 | | Total stockholders' equity | $639,874 | $677,611 | [Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Q1 2025 revenues more than doubled to $32.7 million, narrowing the operating loss to $43.2 million and significantly improving net loss to $48.4 million Q1 2025 vs Q1 2024 Performance (in thousands, except per share amounts) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Total Revenue** | **$32,732** | **$15,997** | | Research and development | $58,578 | $56,873 | | General and administrative | $17,337 | $13,787 | | **Operating Loss** | **($43,183)** | **($54,663)** | | Asset impairment charges | ($4,865) | ($20,650) | | **Net Loss Attributable to Xencor** | **($48,418)** | **($73,440)** | | Net Loss Per Share (basic and diluted) | ($0.66) | ($1.20) | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities significantly decreased to $16.2 million in Q1 2025, resulting in a net decrease in cash of $1.3 million for the quarter Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($16,220) | ($56,859) | | Net cash provided by investing activities | $13,668 | $32,318 | | Net cash provided by financing activities | $1,249 | $1,787 | | **Net decrease in cash** | **($1,303)** | **($22,754)** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail revenue recognition from collaborations, a $4.9 million asset impairment, the $154.4 million royalty liability, and ongoing patent litigation Q1 2025 Revenue by Partner (in thousands) | Partner | Revenue | Notes | | :--- | :--- | :--- | | Alexion | $15,469 | Non-cash royalty revenue for Ultomiris® | | Incyte | $15,263 | Includes $12.5M milestone and non-cash royalties for Monjuvi® | | Vir Bio | $2,000 | Milestone payment for tobevibart | | **Total** | **$32,732** | | - The company recorded a **$4.9 million** asset impairment charge in Q1 2025 related to its decision to pause further development of certain programs and reallocate resources[56](index=56&type=chunk) - In November 2023, the company sold rights to future royalties for Ultomiris and Monjuvi to OMERS. This transaction is accounted for as debt, with a remaining liability of **$154.4 million** as of March 31, 2025[59](index=59&type=chunk)[60](index=60&type=chunk)[64](index=64&type=chunk) - Xencor is a party to a patent infringement lawsuit initiated by Merus N.V. in August 2024. The company believes it has strong defenses but cannot guarantee a favorable outcome[66](index=66&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's clinical pipeline, significant Q1 2025 revenue increase driven by milestones, rising R&D expenses, and a strong liquidity position expected to fund operations into 2028 - The company's clinical pipeline is focused on advancing multiple drug candidates, including XmAb819 (renal cell carcinoma), XmAb541 (ovarian cancer), and XmAb942 (inflammatory bowel disease)[99](index=99&type=chunk)[100](index=100&type=chunk)[102](index=102&type=chunk) Q1 2025 vs Q1 2024 Operating Results (in thousands) | Category | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $32,732 | $15,997 | $16,735 | | R&D Expenses | $58,578 | $56,873 | $1,705 | | G&A Expenses | $17,337 | $13,787 | $3,550 | | Operating Loss | ($43,183) | ($54,663) | $11,480 | - The increase in revenue for Q1 2025 was primarily due to a **$12.5 million** milestone from Incyte and a **$2.0 million** milestone from Vir Bio[112](index=112&type=chunk)[115](index=115&type=chunk)[126](index=126&type=chunk) - As of March 31, 2025, the company had **$693.5 million** in cash, cash equivalents, and marketable debt securities and believes these resources will fund operations into 2028[134](index=134&type=chunk)[140](index=140&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in the company's exposure to market risk have occurred since the prior fiscal year-end - There have been no material changes in the Company's exposure to market risk from the end of the previous fiscal year[143](index=143&type=chunk) [Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective as of March 31, 2025, due to material weaknesses in accounting for royalties and tax legislation, with a remediation plan underway - The CEO and CFO concluded that disclosure controls and procedures were not effective as of March 31, 2025[145](index=145&type=chunk) - The ineffectiveness was due to material weaknesses in controls related to accounting for the sale of future royalties (a non-routine transaction) and the evaluation of tax legislation[145](index=145&type=chunk) - Management has implemented a remediation plan that includes engaging third-party advisors for complex transactions and enhancing internal review processes[146](index=146&type=chunk)[147](index=147&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) Xencor is involved in a patent infringement lawsuit initiated by Merus N.V., asserting strong defenses against the allegations - Xencor is being sued by Merus N.V. for alleged patent infringement related to its antibody technologies[153](index=153&type=chunk) - Xencor has responded by filing a motion to dismiss and challenging the validity of the patents in question before the U.S. Patent and Trademark Appeal Board[153](index=153&type=chunk) [Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) The company faces increased risks from unfavorable global economic and political conditions, supply chain disruptions, and potential delays from government agency disruptions - The company's business is susceptible to unfavorable global economic conditions, political disruptions, and changes in international trade policy, which could strain suppliers and weaken demand[155](index=155&type=chunk)[156](index=156&type=chunk) - Disruptions at the FDA and other government agencies, caused by factors like budget issues or personnel shortages, could delay the review and approval of new products, negatively impacting the business[158](index=158&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section is not applicable for the current reporting period - Not applicable[159](index=159&type=chunk) [Other Information](index=31&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted or terminated Rule 10b5-1 or other trading arrangements during the quarter[162](index=162&type=chunk) [Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including corporate documents and officer certifications - Lists all exhibits filed with the report, including officer certifications (31.1, 31.2, 32.1) and iXBRL data files (101, 104)[163](index=163&type=chunk)

[First Quarter 2025 Financial Results and Business Update](index=1&type=section&id=First%20Quarter%202025%20Financial%20Results%20and%20Business%20Update) Xencor reported strong Q1 2025 financial results, advanced key programs, and provided positive financial guidance [Key Highlights & Management Commentary](index=1&type=section&id=Key%20Highlights%20%26%20Management%20Commentary) Xencor reported positive XmAb942 Phase 1 results supporting 12-week dosing for Phase 2b, and announced a key executive transition - Interim Phase 1 results for XmAb942 (anti-TL1A) support a 12-week subcutaneous maintenance dosing regimen, a potential improvement over first-generation anti-TL1A antibodies[2](index=2&type=chunk)[3](index=3&type=chunk) - A Phase 2b study of XmAb942 in ulcerative colitis, named XENITH-UC, is on track to be initiated in the second half of **2025**[2](index=2&type=chunk)[3](index=3&type=chunk) - Nancy Valente, M.D., Chief Development Officer, will retire from her role and transition to a senior advisor position in June **2025**[2](index=2&type=chunk)[3](index=3&type=chunk) - The company plans to advance an XmAb TL1A x IL23p19 bispecific antibody candidate into Phase 1 trials in **2026**[3](index=3&type=chunk) [Recent Program Updates](index=1&type=section&id=Recent%20Program%20Updates) Xencor provided program updates, including XmAb942's Phase 1 data supporting 12-week dosing and advancing a novel bispecific antibody - **XmAb942 (Xtend™ TL1A):** Interim Phase 1 results from a dose-escalation study in healthy volunteers showed the antibody was well tolerated and has an estimated human half-life of over **71 days**[5](index=5&type=chunk) - The Phase 2b XENITH-UC study will be a randomized, double-blind, placebo-controlled trial in patients with moderate-to-severe ulcerative colitis[6](index=6&type=chunk) - **XmAb TL1A x IL23p19:** A bispecific antibody targeting two inflammatory pathways is in lead selection, with GMP production campaigns initiated. First-in-human studies are expected to begin in **2026**[6](index=6&type=chunk) [Recent Partnership Developments](index=2&type=section&id=Recent%20Partnership%20Developments) Xencor recognized **$12.5 million** from Incyte and **$2.0 million** from Vir Biotechnology in Q1 2025 from key partnership milestones - **Incyte Corporation:** Earned a **$12.5 million** regulatory milestone payment after the FDA accepted for review a supplemental BLA for tafasitamab in relapsed or refractory follicular lymphoma[11](index=11&type=chunk) - **Vir Biotechnology, Inc.:** Earned a **$2.0 million** development milestone payment following the initiation of a Phase 3 study of tobevibart (using XmAb Fc technologies) for chronic hepatitis delta[11](index=11&type=chunk) [Additional Corporate Updates & Financial Guidance](index=2&type=section&id=Additional%20Corporate%20Updates%20%26%20Financial%20Guidance) Xencor appointed a new board member and projected **$535 million to $585 million** cash by year-end 2025, funding operations into **2028** - In March, Todd Simpson, former CFO at Seagen, was appointed to Xencor's board of directors[8](index=8&type=chunk) - The company expects to end **2025** with cash, cash equivalents, and marketable debt securities between **$535 million** and **$585 million**[8](index=8&type=chunk) - The current cash position is anticipated to fund research and development programs and operations into **2028**[8](index=8&type=chunk) [Financial Results for the First Quarter Ended March 31, 2025](index=2&type=section&id=Financial%20Results%20for%20the%20First%20Quarter%20Ended%20March%2031%2C%202025) Xencor's Q1 2025 revenue more than doubled to **$32.7 million**, narrowing net loss to **$48.4 million**, and maintaining **$693.5 million** in cash First Quarter Financial Performance | Financial Metric | Q1 2025 ($M) | Q1 2024 ($M) | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | 32.7 | 16.0 | +104.4 | | **R&D Expenses** | 58.6 | 56.9 | +3.0 | | **G&A Expenses** | 17.3 | 13.8 | +25.4 | | **Net Loss** | (48.4) | (73.4) | +34.1 (Loss Reduced) | | **Net Loss Per Share** | (0.66) | (1.20) | +45.0 (Loss Reduced) | Selected Balance Sheet Data | Balance Sheet Item | March 31, 2025 ($M) | December 31, 2024 ($M) | | :--- | :--- | :--- | | **Cash, cash equivalents and marketable debt securities** | 693.5 | 706.7 | - The increase in R&D expenses was primarily due to increased spending on XmAb819 (ENPP3 x CD3), XmAb541 (CLDN6 x CD3), and XmAb657 (CD19 x CD3) programs[12](index=12&type=chunk) - The decrease in 'Other expense, net' to **$5.1 million** from **$19.5 million** in Q1 2024 was primarily due to lower asset impairment charges[13](index=13&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) The company's financial statements detail its balance sheet position and operational performance for the first quarter of 2025 [Selected Consolidated Balance Sheet Data](index=5&type=section&id=Selected%20Consolidated%20Balance%20Sheet%20Data) As of March 31, 2025, Xencor reported total assets of **$904.7 million**, liabilities of **$264.8 million**, and **$693.5 million** in cash and equivalents Selected Consolidated Balance Sheet Data (in thousands) | (in thousands) | March 31, 2025 (Unaudited, $ thousands) | December 31, 2024 ($ thousands) | | :--- | :--- | :--- | | **Cash, cash equivalents and marketable debt securities** | 693,511 | 706,679 | | **Total assets** | 904,689 | 951,945 | | **Total liabilities** | 264,815 | 277,919 | | **Total stockholders' equity** | 639,874 | 674,026 | [Consolidated Statements of Operations and Comprehensive Loss](index=6&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For Q1 2025, Xencor reported **$32.7 million** revenue, **$43.2 million** operating loss, and **$48.4 million** net loss, or **$(0.66)** per share Consolidated Statements of Operations and Comprehensive Loss (in thousands, except per share data) | (in thousands, except per share data) | Three Months Ended March 31, 2025 ($ thousands) | Three Months Ended March 31, 2024 ($ thousands) | | :--- | :--- | :--- | | **Revenue** | 32,732 | 15,997 | | **Total operating expenses** | 75,915 | 70,660 | | **Operating loss** | (43,183) | (54,663) | | **Net loss attributable to Xencor, Inc.** | (48,418) | (73,440) | | **Net loss per share (Basic and Diluted)** | (0.66) | (1.20) | | **Weighted-average shares outstanding** | 73,667,179 | 61,212,324 |

XmAb Technology and Pipeline - Xencor's XmAb platform is used to engineer antibodies with enhanced properties, focusing on oncology and autoimmune diseases[4, 9, 10] - The pipeline includes T-cell engagers and bispecific antibodies targeting various cancers and autoimmune conditions, such as IBD and rheumatoid arthritis[10, 11] - Key programs include XmAb942 (TL1A inhibitor) for IBD, Plamotamab (CD20xCD3) for rheumatoid arthritis, and XmAb819 (ENPP3 x CD3) for ccRCC[11, 12] XmAb942: Anti-TL1A Antibody for IBD - XmAb942 is designed for potent TL1A inhibition, convenient subcutaneous dosing, and extended half-life, potentially enabling Q12W maintenance dosing[31] - Phase 1 study in healthy volunteers showed a +71 day estimated half-life and dose-dependent increases in total TL1A, supporting less frequent dosing[31, 45] - Phase 1 data also showed rapid and sustained reduction of free sTL1A below the lower limit of quantification (LLOQ) for at least 16 weeks from a single dose[49] XmAb942 Clinical Development and Market Opportunity - A Phase 2 study (XENITH-UC) in ulcerative colitis is planned, with a design to maximize drug exposure and potentially achieve greater efficacy[56, 61] - The global IBD drug market is projected to exceed $23 billion by 2030, with anti-TL1A therapies expected to capture a significant portion[14, 74] - Gastroenterologist surveys indicate high expected utilization of anti-TL1A drugs, with approximately 9 out of 10 expecting to use them as first or second-line advanced therapy[74] XmAb TL1A x IL23 Bispecific Program - Xencor is developing XENP53***, a TL1A x IL23p19 bispecific antibody, with lead candidate selection and GMP production underway for a planned first-in-human study in 2026[11, 71] - Preclinical data suggests competitive functional potency for both TL1A and IL23 inhibition compared to other agents[69, 70] Financial Position - Xencor reported $706.7 million in cash, cash equivalents, and marketable debt securities as of December 31, 2024, supporting the development and expansion of the TL1A program[89]

Summary of Xencor (XNCR) Update / Briefing April 29, 2025 Company Overview - **Company**: Xencor (XNCR) - **Focus**: Development of protein engineering and drug molecules for unmet medical needs, particularly in oncology and immunology Key Industry Insights - **Industry**: Inflammatory Bowel Disease (IBD) treatment - **Current Market Need**: High unmet medical need in IBD, with existing medications achieving remission in only 10% to 20% of patients [7][8] - **Target Population**: Over 3 million individuals affected by IBD in the U.S. and Europe [7] Core Program Updates - **XmAb942**: A high potency, half-life extended anti-TL1A antibody - **Phase I Study Results**: Positive interim results indicating safety and pharmacokinetics [2][12] - **Half-Life**: Estimated at greater than 71 days, promising for convenient dosing [14] - **Dosing Schedule**: Planned Q12 week subcutaneous maintenance dosing [11][21] - **TL1A by IL-23 P19 Bispecific**: A lead candidate designed to combine two effective mechanisms of action for IBD treatment - **Development Timeline**: First in human studies expected in 2026 [58] Clinical Development Plans - **Phase II Study (ZENITH UC)**: - Focus on patients with moderately to severely active ulcerative colitis who have failed previous therapies [19][21] - Primary endpoint: Clinical remission based on modified Mayo Score at week twelve [21] - Expected to start in the second half of 2025 [61] Competitive Landscape - **Comparison with Competitors**: XmAb942 expected to provide higher drug exposure and better clinical outcomes compared to leading first-generation anti-TL1A drugs [60] - **Dosing Frequency**: Over 90% of surveyed gastroenterologists believe that XmAb942's Q12 week dosing could significantly improve patient compliance [61] Future Directions - **Combination Therapies**: Emphasis on developing a combination strategy with IL-23 and TL1A targeting to enhance efficacy [49][54] - **Market Positioning**: Xencor aims to position XmAb942 as a first or second line treatment option in advanced IBD therapy [60] Important Considerations - **Safety Profile**: No significant safety signals observed in Phase II data for competing therapies [31] - **Patient Compliance**: A more convenient dosing schedule is expected to improve patient quality of life and adherence to treatment [42][43] Conclusion - Xencor is advancing its pipeline with promising data for XmAb942 and a bispecific candidate targeting TL1A and IL-23, aiming to address significant unmet needs in IBD treatment while enhancing patient experience through improved dosing regimens and safety profiles [66]

Group 1 - Xencor (XNCR) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][3] - The Zacks rating system is based on changes in earnings estimates, which are tracked through a consensus measure from sell-side analysts, reflecting the company's earnings outlook [2][6] - The upgrade suggests that Xencor's improving earnings outlook could lead to increased buying pressure and a rise in stock price [3][5] Group 2 - The correlation between earnings estimate revisions and stock price movements is strong, particularly due to institutional investors who adjust their valuations based on these estimates [4][6] - Xencor is projected to earn -$2.87 per share for the fiscal year ending December 2025, representing a year-over-year change of 19.8%, with a 21.3% increase in the Zacks Consensus Estimate over the past three months [8] - The Zacks Rank system maintains a balanced distribution of ratings, with only the top 20% of stocks receiving a 'Strong Buy' or 'Buy' rating, indicating superior earnings estimate revisions [9][10]

Company Performance - Xencor reported a quarterly loss of $0.62 per share, which was better than the Zacks Consensus Estimate of a loss of $0.83, but worse than the loss of $0.31 per share from a year ago [1] - The quarterly report represented an earnings surprise of 25.30%, with the company previously expected to post a loss of $0.98 per share but actually reporting a loss of $0.71, resulting in a surprise of 27.55% [2] - Xencor's revenues for the quarter ended December 2024 were $52.79 million, exceeding the Zacks Consensus Estimate by 293.40%, compared to $44.69 million in the same quarter last year [3] Market Performance - Xencor shares have declined approximately 37.4% since the beginning of the year, while the S&P 500 has gained 1.3% [4] - The current consensus EPS estimate for the upcoming quarter is -$0.88 on revenues of $12.11 million, and for the current fiscal year, it is -$3.64 on revenues of $59.03 million [8] Industry Outlook - The Medical - Drugs industry, to which Xencor belongs, is currently ranked in the top 50% of over 250 Zacks industries, indicating that companies in this segment are expected to outperform those in the bottom 50% by a factor of more than 2 to 1 [9]

Drug Development and Clinical Trials - The company is focused on developing engineered antibody therapeutics for cancer and autoimmune diseases, advancing multiple drug candidates into clinical development[13]. - The XmAb 2+1 bispecific antibody format has shown potential in preclinical models, effectively targeting tumor cells while sparing normal cells[21]. - XmAb657 demonstrated over 99.98% reduction in B cells in non-human primate studies, with a half-life estimated at 15 days, indicating potential for durable B-cell depletion[23]. - The company plans to initiate a first-in-human study for XmAb657 in the second half of 2025[23]. - XmAb819 has shown initial evidence of anti-tumor activity in advanced clear cell renal cell carcinoma (ccRCC) patients, with some patients experiencing treatment durations extending beyond one year[33]. - XmAb541 is in a Phase 1 study for ovarian cancer, with the first patient dosed in April 2024[34]. - The company has paused further development of vudalimab to prioritize other pipeline programs, with safety data remaining consistent[38]. - New XmAb drug candidates, including XmAb942 and XmAb657, are being evaluated for autoimmune and inflammatory diseases[39]. - Plamotamab demonstrated encouraging clinical activity in heavily pretreated patients with advanced lymphoma, with patient enrollment in subcutaneous dose escalation cohorts completed in 2023[41]. - A Phase 1b/2a proof-of-concept study for plamotamab in rheumatoid arthritis (RA) is planned for the first half of 2025, with efficacy evaluated at week 12[42]. - XmAb7195 was reacquired in 2024, and development opportunities are being evaluated after being licensed to Aimmune Therapeutics in 2020[43]. - Xaluritamig showed a median overall survival of 17.7 months in a Phase 1 study for mCRPC, with a PSA90 rate of 45.1% observed in high-dose cohorts[50]. - Obexelimab is in a Phase 3 study for IgG4-related disease and Phase 2 studies for relapsing multiple sclerosis and systemic lupus erythematosus[51]. Financial Performance and Projections - The company has incurred significant losses since its inception and anticipates continuing to incur significant losses for the foreseeable future[168]. - For the year ended December 31, 2024, the company incurred a net loss of $232.6 million and had an accumulated deficit of $704.0 million[179]. - As of December 31, 2024, the company had $706.7 million in cash, cash equivalents, and marketable debt securities, which is expected to fund operations into 2028[184]. - The company anticipates incurring additional net losses in future years as it continues its research and development activities[180]. - The company expects its financial condition and operating results to fluctuate significantly from quarter to quarter and year to year due to various uncontrollable factors[172]. - The company may require additional financing to support its research and development programs, which could lead to dilution of existing shareholders[168]. - The company may require additional financing to complete the clinical development of its product candidates, which may not be available on favorable terms[186]. - The market price of the company's common stock is likely to be highly volatile, influenced by various factors including market conditions and operational performance[189]. - The trading price of the company's common stock has ranged from a low of approximately $5.75 to a high of approximately $58.345 since its IPO[188]. - Approximately 56.8% of the company's voting stock is owned by executive officers, directors, and significant stockholders, allowing them to exert significant control over corporate matters[191]. Regulatory and Compliance - Regulatory compliance is critical, with extensive requirements from the FDA and other authorities for drug development, including preclinical studies and clinical trials[105][106]. - The process for obtaining FDA approval involves multiple steps, including submission of a Biologics License Application (BLA) and compliance with Good Manufacturing Practices (GMP)[107][110]. - The FDA requires that all clinical trials conducted under an IND must meet specific requirements unless waived[113]. - Clinical trials are conducted in three phases, with Phase 1 focusing on safety and dosage, Phase 2 on efficacy and safety in a larger patient population, and Phase 3 on substantial evidence of clinical efficacy and safety[115]. - The standard FDA review process for a BLA is 10 months once accepted, but it can take longer depending on various factors[121]. - The FDA may require post-marketing studies to further assess drug safety and effectiveness, which can impact the commercial value of the product[125]. - Material changes in manufacturing processes post-approval may necessitate additional regulatory review and approval[121]. - Biologic product manufacturers must comply with comprehensive FDA regulations, including cGMP compliance and periodic reporting requirements[136]. - The company is subject to extensive regulations governing the development and commercialization of its products, which may complicate compliance efforts[163]. Intellectual Property and Market Position - The company aims to expand its patent portfolio to protect its proprietary Fc technologies and drug candidates[26]. - The company has filed patent applications for thousands of specific Fc domain variants, enhancing its intellectual property position[73]. - The patent expiration for key technologies includes bispecific (2034 U.S. and Ex-U.S.) and CD3 T-Cell Engagers (2035 U.S. and Ex-U.S.)[74]. - The company relies on third-party vendors for research, development, and clinical activities, maintaining flexibility in its infrastructure[80]. - The company has agreements with KBI Biopharma and WuXi Biologics for manufacturing and development services for its antibody candidates[81][88]. - The company is developing bispecific antibody drug candidates targeting solid tumor cells and B cells, competing with major companies like Amgen, Genmab, and Roche[101][102]. - The company is also working on antibody drug candidates targeting the cytokine TL1A for potential IBD treatment, facing competition from firms like Merck and Roche[103]. Workforce and Internal Controls - As of December 31, 2024, the company had 250 full-time employees, with 203 engaged in research and development activities[64]. - The workforce was 58% non-white and 59% women as of December 31, 2024, with women making up 30% of the senior leadership team[65]. - The company completed a reduction in force (RIF) affecting approximately 10% of the total employee headcount in January 2024[66]. - The company has identified material weaknesses in its internal control over financial reporting, which could affect the accuracy and timeliness of its financial reports[168]. - The company is subject to additional internal control requirements under the Sarbanes-Oxley Act of 2002 as a large accelerated filer[200]. Market and Economic Factors - The market size for the treatment of Crohn's disease and ulcerative colitis is projected to reach $40 billion worldwide by 2032[71]. - The American Cancer Society estimates approximately 2.0 million new cases of cancer and about 618,120 cancer deaths in the U.S. by 2025[69]. - Medical expenditures for cancer in the U.S. are projected to reach at least $245.6 billion by 2030[69]. - The company is susceptible to adverse impacts from inflation and economic volatility, which could affect its financial performance[175]. - Legislative and regulatory proposals aimed at healthcare cost containment could impact the company's ability to sell product candidates profitably[150]. Stock and Shareholder Matters - The company has never declared or paid any cash dividend on its common stock and does not anticipate doing so in the foreseeable future[205]. - The company is authorized to grant equity awards covering up to 18,367,000 shares of its common stock under its equity compensation plans[195]. - The company has options to purchase 12,370,081 shares outstanding under its equity compensation plans[195]. - The company may offer and sell shares of its common stock with an aggregate offering price of up to $200 million through an ATM Offering[198]. - No shares of common stock were sold pursuant to the ATM Offering from the date of the ATM Prospectus through December 31, 2024[198]. - Provisions in the company’s charter documents may make it more difficult for third parties to acquire the company, potentially affecting stockholder value[206].

Group 1 - Xencor (XNCR) has experienced a significant decline of 21.7% over the past four weeks, but it is now in oversold territory, indicating a potential for a trend reversal [1] - The Relative Strength Index (RSI) for XNCR is currently at 27.45, suggesting that the heavy selling pressure may be exhausting, which could lead to a rebound [5] - There is a strong consensus among Wall Street analysts that XNCR will report better earnings than previously predicted, with a 1.6% increase in the consensus EPS estimate over the last 30 days [6] Group 2 - XNCR holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a strong potential for a turnaround [7]

Core Viewpoint - Xencor (XNCR) has experienced a significant downtrend with a 20.3% decline over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is utilized to identify oversold stocks, with a reading below 30 indicating oversold conditions [2]. - XNCR's current RSI reading is 27.2, suggesting that the heavy selling pressure may be exhausting, indicating a possible price rebound [5]. Group 2: Fundamental Indicators - Analysts have raised earnings estimates for XNCR by 1.6% over the last 30 days, which typically correlates with price appreciation in the near term [6]. - XNCR holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a turnaround [7].