Company Performance - XOMA Royalty reported quarterly earnings of $0.48 per share, exceeding the Zacks Consensus Estimate of a loss of $0.12 per share, and showing improvement from a loss of $0.28 per share a year ago, resulting in an earnings surprise of +500.00% [1] - The company posted revenues of $13.13 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 39.30%, compared to revenues of $11.09 million in the same quarter last year [2] - Over the last four quarters, XOMA Royalty has surpassed consensus EPS estimates three times and has topped consensus revenue estimates three times as well [2] Stock Performance - XOMA Royalty shares have increased approximately 8.3% since the beginning of the year, while the S&P 500 has gained 9.6% [3] - The current status of estimate revisions for XOMA Royalty is mixed, leading to a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.03 on revenues of $9.75 million, and for the current fiscal year, it is $0.02 on revenues of $45.7 million [7] - The outlook for the Medical - Biomedical and Genetics industry, where XOMA Royalty operates, is currently in the bottom 41% of over 250 Zacks industries, which may impact the stock's performance [8]

[Executive Summary & Business Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Highlights) This section covers recent business achievements, including acquisitions and pipeline advancements, alongside financial highlights for H1 and Q2 2025, emphasizing portfolio expansion and cash flow [Recent Business Achievements](index=1&type=section&id=Recent%20Business%20Achievements) XOMA Royalty expanded its portfolio through mezagitamab royalty acquisition and LAVA Therapeutics interests, alongside multiple company acquisitions and key pipeline advancements - Purchased **mezagitamab royalty and milestone rights** from BioInvent International[2](index=2&type=chunk) - Secured **royalty economic interests** in two early-stage partnered assets via XOMA Royalty's acquisition of LAVA Therapeutics[2](index=2&type=chunk) - XOMA Royalty announced acquisitions of **Turnstone Biologics, LAVA Therapeutics, and HilleVax**[3](index=3&type=chunk) - Acted as structuring agent and provided financing for **XenoTherapeutics' acquisition of ESSA Pharma**[3](index=3&type=chunk) - Completed the sale of **Kinnate pipeline assets**, distributing upfront proceeds to CVR holders[3](index=3&type=chunk) - Rezolute completed enrollment in **Phase 3 sunRIZE study** of ersodetug for congenital hyperinsulinism[4](index=4&type=chunk) - Day One Biopharmaceuticals and Ipsen's tovorafenib MAA was accepted by EMA, triggering a **$4 million milestone payment** to XOMA Royalty[4](index=4&type=chunk) - Zevra Therapeutics submitted an MAA to EMA for **arimoclomol** as a treatment for Niemann-Pick Type C[4](index=4&type=chunk) [Financial Highlights & CEO Commentary](index=1&type=section&id=Financial%20Highlights%20%26%20CEO%20Commentary) XOMA Royalty received **$29.6 million** in H1 2025 royalties and milestones, with the CEO highlighting portfolio expansion and a path to positive cash flow Cash Receipts (H1 & Q2 2025) | Period | Total Cash Receipts | | :--- | :--- | | First Half 2025 | $29.6 million | | Second Quarter 2025 | $11.7 million | - CEO Owen Hughes emphasized **diversified portfolio expansion** through disciplined capital deployment, driving increased royalty receipts and a clearer path to becoming cash flow positive[6](index=6&type=chunk) [Detailed Business Activities](index=2&type=section&id=Detailed%20Business%20Activities) This section details XOMA Royalty's business development, acquisitions, and significant pipeline advancements and anticipated partner events [Business Development & Acquisitions Details](index=2&type=section&id=Business%20Development%20%26%20Acquisitions%20Details) XOMA Royalty expanded its portfolio through mezagitamab royalty acquisition, LAVA Therapeutics interests, and definitive merger agreements for Turnstone, HilleVax, and LAVA - XOMA Royalty deployed **$20 million** to purchase future **mezagitamab royalty and milestone interests** from BioInvent[7](index=7&type=chunk) - An additional **$10 million** will be paid upon a specific regulatory milestone[7](index=7&type=chunk) - XOMA Royalty is entitled to **up to $16.25 million in milestones** from Takeda and mid-single digit royalties on future sales[7](index=7&type=chunk) - XOMA Royalty secured economic interests in **PF-08046052 (Pfizer)** and **JNJ-89853413 (Johnson & Johnson)** through the LAVA Therapeutics acquisition[7](index=7&type=chunk) - **Turnstone Biologics** acquired for **$0.34 cash per share** plus a CVR, closing August 11[7](index=7&type=chunk) - **HilleVax** acquired for **$1.95 per share** plus a CVR, expected to complete in September[7](index=7&type=chunk) - **LAVA Therapeutics** acquired for **$1.16-$1.24 cash per share** plus a CVR, expected to close in Q4 2025[7](index=7&type=chunk) - XOMA Royalty facilitated **XenoTherapeutics' acquisition of ESSA Pharma** by acting as structuring agent and providing financing[7](index=7&type=chunk) - **Kinnate pipeline assets** sold for **up to $270 million** in payments and royalties, with CVR holders receiving their share of upfront payments[7](index=7&type=chunk) [Pipeline Partner Updates through August 8, 2025](index=3&type=section&id=Pipeline%20Partner%20Updates%20through%20August%208,%202025) Partners achieved key clinical and regulatory milestones, including Rezolute's BTD and Phase 3 enrollment, Takeda's mezagitamab Phase 3, and MAA acceptances for tovorafenib and arimoclomol - U.S. FDA granted **Breakthrough Therapy Designation (BTD)** to ersodetug for hypoglycemia caused by tumor HI[8](index=8&type=chunk) - Completed enrollment in the **Phase 3 sunRIZE study**, triggering a **$5 million milestone payment** to XOMA Royalty[8](index=8&type=chunk) - Takeda dosed the first patient in a **Phase 3 mezagitamab trial** for chronic primary immune thrombocytopenia (ITP), resulting in a **$3.0 million net milestone payment** to XOMA Royalty[8](index=8&type=chunk) - Day One Biopharmaceuticals' MAA for **tovorafenib** (pediatric low-grade glioma) was accepted for review by the EMA[8](index=8&type=chunk) - Zevra Therapeutics submitted an MAA to EMA for **arimoclomol** for Niemann-Pick Disease Type C treatment[8](index=8&type=chunk) - Gossamer Bio completed enrollment in the **Phase 3 PROSERA Study** evaluating **seralutinib** for pulmonary atrial hypertension (PAH)[8](index=8&type=chunk) - Daré Biosciences announced positive interim **Phase 3 safety and efficacy results** for **Ovaprene®**, a monthly, hormone-free intravaginal contraceptive[8](index=8&type=chunk) [Anticipated 2025 Partner Events of Note](index=4&type=section&id=Anticipated%202025%20Partner%20Events%20of%20Note) Key anticipated partner events in late 2025 include Rezolute's sunRIZE Phase 3 data, Takeda's mezagitamab Phase 3, Gossamer Bio's SERANATA study, and Daré Bioscience's Sildenafil Cream commercial launch - **Topline data** from **sunRIZE Phase 3 clinical trial** (ersodetug for congenital hyperinsulinism) expected in **December 2025**[9](index=9&type=chunk) - First patient dosed in the **Phase 3 registrational study** for ersodetug for hypoglycemia due to tumor hyperinsulinism[9](index=9&type=chunk) - First patient dosed in Takeda's **Phase 3 clinical trial** investigating **mezagitamab** for adults with IgA Nephropathy[9](index=9&type=chunk) - Gossamer Bio activates first clinical sites for the **Phase 3 SERANATA Study** (seralutinib for pulmonary hypertension) in **Q4**[9](index=9&type=chunk) - **Sildenafil Cream, 3.6%** expected to be commercially available in **Q4 2025**[9](index=9&type=chunk) - Commencement of one of two **Phase 3 clinical trials** for Sildenafil Cream, 3.6% for female sexual arousal disorder[9](index=9&type=chunk) [Financial Performance Review](index=4&type=section&id=Financial%20Performance%20Review) This section provides a detailed financial overview for Q2 and H1 2025, including cash receipts, income statement analysis, and net income and cash position [Second Quarter and Year to Date 2025 Financial Overview](index=4&type=section&id=Second%20Quarter%20and%20Year%20to%20Date%202025%20Financial%20Overview) XOMA Royalty received **$29.6 million** in H1 2025 cash from partners, with **$11.7 million** in Q2, and repurchased **over 107,500 shares** year-to-date Cash Receipts from Partners (H1 & Q2 2025) | Period | Total Cash Receipts | Royalty Payments | Milestone Payments & Fees | | :--- | :--- | :--- | :--- | | First Half 2025 | $29.6 million | $16.0 million | $13.6 million | | Second Quarter 2025 | $11.7 million | $2.6 million | $9.0 million | Common Stock Repurchases (Q2 & H1 2025) | Period | Shares Repurchased | Cost | | :--- | :--- | :--- | | Second Quarter 2025 | 81,682 | $1.8 million | | Year to Date 2025 | >107,500 | $2.4 million | [Detailed Income Statement Analysis](index=5&type=section&id=Detailed%20Income%20Statement%20Analysis) XOMA Royalty saw increased income and revenue in Q2 and H1 2025, driven by VABYSMO and OJEMDA, alongside decreased R&D and G&A expenses, and significant other income growth Income and Revenue (in millions) | Period | 2025 | 2024 | Change (YoY) | Primary Driver | | :--- | :--- | :--- | :--- | :--- | | Q2 | $13.1 | $11.1 | +$2.0 (+18.0%) | VABYSMO and OJEMDA | | H1 | $29.0 | $12.6 | +$16.4 (+130.2%) | VABYSMO and OJEMDA | Research and Development (R&D) Expenses (in millions) | Period | 2025 | 2024 | Change (YoY) | Primary Driver | | :--- | :--- | :--- | :--- | :--- | | Q2 | $0.1 | $1.2 | -$1.1 (-91.7%) | Wind-down of Kinnate KIN-3248 clinical trial costs | | H1 | $1.4 | $1.2 | +$0.2 (+16.7%) | Wind-down of Kinnate KIN-3248 clinical trial costs | General and Administrative (G&A) Expenses (in millions) | Period | 2025 | 2024 | Change (YoY) | Primary Driver | | :--- | :--- | :--- | :--- | :--- | | Q2 | $7.8 | $11.0 | -$3.2 (-29.1%) | Lower exit packages to Kinnate senior leadership | | H1 | $15.9 | $19.5 | -$3.6 (-18.5%) | Lower exit packages to Kinnate senior leadership | Non-Cash Stock-Based Compensation (G&A) (in millions) | Period | 2025 | 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Q2 | $1.6 | $2.7 | -$1.1 (-40.7%) | | H1 | $3.6 | $5.5 | -$1.9 (-34.5%) | Credit Losses on Purchased Receivables (in millions) | Period | 2025 | 2024 | | :--- | :--- | :--- | | Q2 | $0.0 | $9.0 | | H1 | $0.0 | $9.0 | Amortization of Intangible Assets (in millions) | Period | 2025 | 2024 | Primary Driver | | :--- | :--- | :--- | :--- | | Q2 | $0.7 | $0.0 | IP acquired from Pulmokine (Nov 2024) and BioInvent (May 2025) | | H1 | $1.2 | $0.0 | IP acquired from Pulmokine (Nov 2024) and BioInvent (May 2025) | - XOMA Royalty recorded a **$19.3 million gain** on the Kinnate acquisition in Q2 2024, with no comparable gain in 2025[17](index=17&type=chunk) Interest Expense (in millions) | Period | 2025 | 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Q2 | $3.2 | $3.4 | -$0.2 (-5.9%) | | H1 | $6.7 | $7.0 | -$0.3 (-4.3%) | Other Income, net (in millions) | Period | 2025 | 2024 | Change (YoY) | Primary Driver | | :--- | :--- | :--- | :--- | :--- | | Q2 | $7.8 | $2.1 | +$5.7 (+271.4%) | Increase in fair value of equity securities | | H1 | $7.7 | $4.0 | +$3.7 (+92.5%) | Increase in fair value of equity securities | [Net Income and Cash Position](index=6&type=section&id=Net%20Income%20and%20Cash%20Position) XOMA Royalty's Q2 2025 net income was **$9.2 million**, while H1 2025 net income increased to **$11.6 million**, with cash and cash equivalents decreasing to **$78.5 million** due to strategic deployments Net Income (in millions) | Period | 2025 | 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Q2 | $9.2 | $16.0 | -$6.8 (-42.5%) | | H1 | $11.6 | $7.4 | +$4.2 (+56.8%) | Cash and Cash Equivalents (in millions) | Date | Amount | | :--- | :--- | | June 30, 2025 | $78.5 | | December 31, 2024 | $106.4 | - **Q2 2025 deployments** included **$20 million** for mezagitamab economics, **$1.8 million** for stock repurchases, and **$1.4 million** in preferred stock dividends[20](index=20&type=chunk) - **H1 2025 deployments** included **$25.0 million** for royalty and milestone assets, **$2.4 million** for stock repurchases, and **$2.7 million** in preferred stock dividends[20](index=20&type=chunk) [Company Overview](index=6&type=section&id=Company%20Overview) XOMA Royalty Corporation operates as a biotechnology royalty aggregator, acquiring future economic rights associated with pre-commercial and commercial therapeutic candidates - XOMA Royalty is a **biotechnology royalty aggregator** acquiring future economics from pre-commercial and commercial therapeutic candidates[21](index=21&type=chunk) - This model provides **non-dilutive, non-recourse funding** to sellers for drug development or general corporate purposes[21](index=21&type=chunk) - The company maintains an **extensive and growing portfolio of assets**, representing rights to future economics from therapeutic candidates[21](index=21&type=chunk)[24](index=24&type=chunk) [Forward-Looking Statements & Disclosures](index=6&type=section&id=Forward-Looking%20Statements%20%26%20Disclosures) This section outlines cautionary forward-looking statements, inherent biotechnology risks, and clarifies definitions of "portfolio" and "assets" and lists commercial assets - Statements on potential commercial payments, anticipated events, regulatory timings, and milestone/royalty proceeds are **forward-looking** and not guarantees of performance[22](index=22&type=chunk) - Actual results may differ materially due to **inherent biotechnology industry risks**, including development uncertainties, market viability, and regulatory approval[22](index=22&type=chunk)[23](index=23&type=chunk) - XOMA Royalty disclaims any obligation to update forward-looking statements, except as legally required[23](index=23&type=chunk) - "Portfolio" refers strictly to **milestone and/or royalty rights** for a basket of drug products in development[24](index=24&type=chunk) - "Assets" refers strictly to **milestone and/or royalty rights** for individual drug products in development[24](index=24&type=chunk) - **Commercial assets** include **VABYSMO®, OJEMDA™, MIPLYFFA™, XACIATO™, IXINITY®, and DSUVIA®**[25](index=25&type=chunk) - All other assets are investigational compounds with **efficacy and safety not established**, and no guarantee of commercial availability[25](index=25&type=chunk) [Condensed Consolidated Financial Statements](index=8&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including statements of operations, balance sheets, and cash flows [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2025, and 2024, detailing income and revenues, operating expenses, other income/expense, and net income Condensed Consolidated Statements of Operations (in thousands, except share and per share amounts) | | | | Three Months Ended June, | | | | Six Month Ended June 30, | | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | | | 2025 | | 2024 | | 2025 | | 2024 | | Income and Revenues: | | | | | | | | | | Income from purchased receivables under the EIR method | $ | 6,007 | $ | 4,562 | | $ 12,077 | $ | 4,562 | | Income from purchased receivables under the cost recovery method | | 1,743 | | 870 | | 7,268 | | 870 | | Revenue from contracts with customers | | 5,025 | | 5,025 | | 9,025 | | 6,025 | | Revenue recognized under units-of-revenue method | | 354 | | 629 | | 671 | | 1,119 | | Total income and revenues | | 13,129 | | 11,086 | | 29,041 | | 12,576 | | Operating expenses: | | | | | | | | | | Research and development | | 69 | | 1,161 | | 1,362 | | 1,194 | | General and administrative | | 7,802 | | 11,004 | | 15,948 | | 19,465 | | Credit losses on purchased receivables | | — | | 9,000 | | — | | 9,000 | | Amortization of intangible assets | | 655 | | — | | 1,199 | | — | | Total operating expenses | | 8,526 | | 21,165 | | 18,509 | | 29,659 | | Income (Loss) from operations | | 4,603 | | (10,079) | | 10,532 | | (17,083) | | Other income (expense) | | | | | | | | | | Gain on the acquisition of Kinnate | | — | | 19,316 | | — | | 19,316 | | Change in fair value of embedded derivative related to RPA | | — | | 8,100 | | — | | 8,100 | | Interest expense | | (3,236) | | (3,402) | | (6,703) | | (6,953) | | Other income, net | | 7,824 | | 2,050 | | 7,729 | | 4,010 | | Net income | $ | 9,191 | $ | 15,985 | | $ 11,558 | $ | 7,390 | | Net income available to common stockholders, basic | $ | 5,522 | $ | 10,224 | $ | 6,225 | $ | 3,253 | | Basic net income per share available to common stockholders | $ | 0.46 | $ | 0.88 | $ | 0.52 | $ | 0.28 | | Weighted average shares used in computing basic net income per share available to common | | | | | | | | | | stockholders | | 12,007 | | 11,643 | | 11,988 | | 11,611 | | Net income available to common stockholders, diluted | $ | 7,823 | $ | 14,617 | $ | 8,822 | $ | 4,654 | | Diluted net income per share available to common stockholders | $ | 0.44 | $ | 0.84 | $ | 0.50 | $ | 0.27 | | Weighted average shares used in computing diluted net income per share available to common | | | | | | | | | | stockholders | | 17,761 | | 17,321 | | 17,777 | | 17,263 | [Condensed Consolidated Balance Sheets](index=9&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the unaudited condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, convertible preferred stock, and stockholders' equity Condensed Consolidated Balance Sheets (in thousands, except share and per share amounts) | | June 30, | December 31, | | :--- | :--- | :--- | | | 2025 | 2024 | | ASSETS | | | | Current assets: | | | | Cash and cash equivalents | $ 75,060 | $ 101,654 | | Short-term restricted cash | 80 | 1,330 | | Investment in equity securities | 8,801 | 3,529 | | Trade and other receivables, net | 1,817 | 1,839 | | Short-term royalty and commercial payment receivables under the EIR method | 17,960 | 14,763 | | Short-term royalty and commercial payment receivables under the cost recovery method | 700 | 413 | | Prepaid expenses and other current assets | 507 | 2,076 | | Total current assets | 104,925 | 125,604 | | Long-term restricted cash | 3,345 | 3,432 | | Property and equipment, net | 26 | 32 | | Operating lease right-of-use assets | 288 | 319 | | Long-term royalty and commercial payment receivables under the EIR method | 4,775 | 4,970 | | Long-term royalty and commercial payment receivables under the cost recovery method | 58,937 | 55,936 | | Exarafenib milestone asset | 3,402 | 3,214 | | Investment in warrants | 609 | — | | Intangible assets, net | 45,434 | 25,909 | | Other assets - long term | 1,715 | 1,861 | | Total assets | $ 223,456 | $ 221,277 | | LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | | | | Current liabilities: | | | | Accounts payable | $ 1,138 | $ 1,053 | | Accrued and other liabilities | 5,411 | 5,752 | | Contingent consideration under RPAs, AAAs, and CPPAs | — | 3,000 | | Operating lease liabilities | 472 | 446 | | Unearned revenue recognized under units-of-revenue method | 1,434 | 1,361 | | Preferred stock dividend accrual | 1,368 | 1,368 | | Current portion of long-term debt | 11,672 | 11,394 | | Total current liabilities | 21,495 | 24,374 | | Unearned revenue recognized under units-of-revenue method – long-term | 3,666 | 4,410 | | Exarafenib milestone contingent consideration | 3,402 | 3,214 | | Long-term operating lease liabilities | 238 | 483 | | Long-term debt | 102,201 | 106,875 | | Total liabilities | 131,002 | 139,356 | | Convertible preferred stock, $0.05 par value, 5,003 shares authorized, issued and outstanding as of June 30, 2025 | | | | and December 31, 2024 | 20,019 | 20,019 | | Stockholders' equity: | | | | 8.625% Series A cumulative, perpetual preferred stock, $0.05 par value, 984,000 shares authorized, issued and | | | | outstanding as of June 30, 2025 and December 31, 2024 | 49 | 49 | | 8.375% Series B cumulative, perpetual preferred stock, $0.05 par value, 3,600 shares authorized, 1,600 shares | | | | issued and outstanding as of June 30, 2025 and December 31, 2024 | — | — | | Common stock, $0.0075 par value, 277,333,332 shares authorized, 12,062,466 and 11,952,377 shares issued | | | | and outstanding as of June 30, 2025 and December 31, 2024, respectively | 90 | 90 | | Additional paid-in capital | 1,300,066 | 1,298,747 | | Accumulated other comprehensive income | 122 | 73 | | Accumulated deficit | (1,227,892) | (1,237,057) | | Total stockholders' equity | 72,435 | 61,902 | | Total liabilities, convertible preferred stock and stockholders' equity | $ 223,456 | $ 221,277 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the unaudited condensed consolidated statements of cash flows for the six months ended June 30, 2025, and 2024, detailing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in thousands) | | | Six Months Ended June 30, | | | :--- | :--- | :--- | :--- | | | 2025 | | 2024 | | Cash flows from operating activities: | | | | | Net income | $ 11,558 | $ | 7,390 | | Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | Adjustment for income from EIR method purchased receivables | (3,935) | | (4,562) | | Stock-based compensation expense | 3,588 | | 5,546 | | Credit losses on purchased receivables | — | | 9,000 | | Gain on the acquisition of Kinnate | — | | (19,316) | | Common stock contribution to 401(k) | 141 | | 118 | | Amortization of intangible assets | 1,199 | | — | | Depreciation | 6 | | 5 | | Accretion of long-term debt discount and debt issuance costs | 749 | | 508 | | Non-cash lease expense | 31 | | 29 | | Change in fair value of equity securities | (5,173) | | (535) | | Change in fair value of available-for-sale debt securities classified as cash equivalents | 49 | | — | | Change in fair value of derivatives | (5) | | — | | Changes in assets and liabilities: | | | | | Trade and other receivables, net | 22 | | 478 | | Prepaid expenses and other assets | 1,715 | | (603) | | Accounts payable and accrued liabilities | (387) | | 921 | | Operating lease liabilities | (219) | | (82) | | Unearned revenue recognized under units-of-revenue method | (671) | | (1,117) | | Net cash provided by (used in) operating activities | 8,668 | | (2,220) | | Cash flows from investing activities: | | | | | Net cash acquired in Kinnate acquisition | — | | 18,926 | | Payments of consideration under RPAs, AAAs, and CPPAs | (8,000) | | (37,000) | | Receipts under RPAs, AAAs, and CPPAs | 2,039 | | 16,741 | | Payment for BioInvent contract-based intangible asset | (20,614) | | — | | Purchase of property and equipment | — | | (17) | | Purchase of equity securities | (99) | | — | | Net cash used in investing activities | (26,674) | | (1,350) | | Cash flows from financing activities: | | | | | Principal payments – debt | (5,065) | | (3,616) | | Debt issuance costs and loan fees paid in connection with long-term debt | (80) | | (661) | | Payment of preferred stock dividends | (2,736) | | (2,736) | | Repurchases of common stock | (2,370) | | (13) | | Proceeds from exercise of options and other share-based compensation | 896 | | 2,353 | | Taxes paid related to net share settlement of equity awards | (570) | | (1,387) | | Net cash used in financing activities | (9,925) | | (6,060) | | Net decrease in cash, cash equivalents and restricted cash | (27,931) | | (9,630) | | 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 | $ 78,485 | | $ 149,920 | | Supplemental Cash Flow Information: | | | | | Cash paid for interest | $ 6,078 | $ | 3,780 | | Cash paid for taxes | $ 277 | $ | — | | Non-cash investing and financing activities: | | | | | Estimated fair value of the Exarafenib milestone asset | $ — | $ | 2,922 | | Estimated fair value of the Exarafenib milestone contingent consideration | $ — | $ | 2,922 | | Right-of-use assets obtained in exchange for operating lease liabilities in Kinnate acquisition | $ — | $ | 824 | | Relative fair value basis reduction of rights-of-use assets in Kinnate acquisition | $ — | $ | (824) | | Accrual of contingent consideration under the Affitech CPPA | $ — | $ | 3,000 | | Preferred stock dividend accrual | $ 1,368 | $ | 1,368 | | Excise tax accrual due to stock repurchases | $ 24 | $ | — | | Transaction costs in connection with BioInvent IP acquisition included in accounts payable | $ 111 | $ | — | [Investor & Media Contacts](index=11&type=section&id=Investor%20%26%20Media%20Contacts) This section provides contact details for investor relations and media inquiries - **Investor Contact:** Juliane Snowden, +1-646-438-9754, juliane.snowden@xoma.com[32](index=32&type=chunk) - **Media Contact:** Kathy Vincent, kathy@kathyvincent.com[32](index=32&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT For the transition period from __________to__________ Commission File Number: 001-39801 XOMA Royalty Corporation (Exact name of Registrant as specified in its charter) (State or other jurisdiction of ...

Core Insights - XOMA Royalty Corporation has made significant acquisitions, including mezagitamab royalty rights from BioInvent International and partnered assets through the acquisition of LAVA Therapeutics, enhancing its portfolio of early- and late-stage assets [1][2][5]. Business Development - XOMA Royalty acquired future royalty and milestone rights for mezagitamab from BioInvent for $20 million, with an additional $10 million contingent on regulatory milestones, potentially earning up to $16.25 million in milestones from Takeda and mid-single digit royalties on future sales [5]. - The acquisition of LAVA Therapeutics will secure economic interests in two partnered assets, PF 08046052 (developed by Pfizer) and JNJ-89853413 (developed by Johnson & Johnson) [5]. Company Acquisitions - XOMA Royalty has entered into definitive agreements to acquire Turnstone Biologics for $0.34 per share plus a contingent value right (CVR) [7]. - The acquisition of HilleVax is set at $1.95 per share, with additional CVR payments based on future cash distributions and potential sales of norovirus programs [7][8]. - The acquisition of LAVA Therapeutics is expected to close in Q4 2025, with a cash payment between $1.16 and $1.24 per share plus a CVR for future proceeds [8]. Key Pipeline Advancements - Rezolute completed enrollment in the Phase 3 sunRIZE study for ersodetug, receiving a $5 million milestone payment [3][9]. - The Marketing Authorization Application (MAA) for tovorafenib by Day One Biopharmaceuticals was accepted for review by the EMA, resulting in a $4 million milestone payment to XOMA Royalty [3][9]. - Zevra Therapeutics submitted an MAA to the EMA for arimoclomol as a treatment for Niemann-Pick Type C [3]. Financial Performance - In the first half of 2025, XOMA Royalty received $29.6 million in royalties and milestones, with $11.7 million in the second quarter [4][12]. - Income for the second quarter of 2025 was reported at $13.1 million, an increase from $11.1 million in the same period of 2024 [12]. - General and administrative expenses decreased to $7.8 million in Q2 2025 from $11.0 million in Q2 2024, primarily due to prior exit packages [14]. Cash Position - As of June 30, 2025, XOMA Royalty had cash and cash equivalents of $78.5 million, down from $106.4 million at the end of 2024 [20][32]. - The company repurchased approximately 81,700 shares for $1.8 million in Q2 2025, totaling over 107,500 shares repurchased in 2025 [21].

EMERYVILLE, Calif., Aug. 11, 2025 (GLOBE NEWSWIRE) -- XOMA Royalty Corporation (NASDAQ: XOMA) ("XOMA Royalty" or the "Company"), a biotechnology royalty aggregator playing a distinctive role in helping biotech companies achieve their goal of improving human health, today announced the Company has successfully completed its previously announced tender offer to acquire all outstanding shares of Turnstone Biologics Corp. (NASDAQ: TSBX) common stock for a price per share of $0.34 in cash (the "Cash Amount"), pl ...

Core Viewpoint - Rowley Law PLLC is investigating potential securities law violations by HilleVax, Inc. related to its proposed acquisition by XOMA Royalty Corporation, where stockholders will receive $1.95 in cash and one contingent value right for each share held, with the transaction expected to close in September 2025 [1]. Group 1 - HilleVax, Inc. is under investigation for potential securities law violations concerning its acquisition by XOMA Royalty Corporation [1]. - Stockholders of HilleVax will receive $1.95 in cash and one contingent value right for each share they hold as part of the acquisition deal [1]. - The acquisition transaction is anticipated to close in September 2025 [1]. Group 2 - Rowley Law PLLC represents shareholders in class actions and derivative lawsuits in complex corporate litigation [3]. - Additional information regarding the investigation can be obtained by contacting Rowley Law PLLC [2].

Group 1: HilleVax, Inc. - HilleVax will be acquired by XOMA Royalty Corporation for $1.95 in cash per share plus one non-transferable contingent value right (CVR) [2] - The investigation focuses on whether the HilleVax Board breached its fiduciary duties by failing to conduct a fair process and whether the consideration provides fair value to shareholders [2] Group 2: Steelcase Inc. - Steelcase will be acquired by HNI Corporation for $7.20 in cash and 0.2192 shares of HNI common stock for each share of Steelcase [4] - The implied per share purchase price is $18.30 based on HNI's closing share price of $50.62 on August 1, 2025 [4] - The investigation concerns whether the Steelcase Board breached its fiduciary duties by failing to conduct a fair process and whether the consideration provides fair value to shareholders [4] Group 3: LAVA Therapeutics N.V. - LAVA will be acquired by XOMA Royalty Corporation for between $1.16 and $1.24 per share in cash, plus a non-transferable CVR [6] - The cash amount consists of a base price of $1.16 per share and an additional amount of up to $0.08 per share [6] - The investigation focuses on whether the LAVA Board breached its fiduciary duties by failing to conduct a fair process and whether the consideration provides fair value to shareholders [6] Group 4: Arcadia Biosciences, Inc. - Arcadia will be acquired by Roosevelt Resources LP, with current equity owners of Roosevelt and Arcadia shareholders expected to own approximately 90% and 10% of the combined company, respectively [8] - The investigation concerns whether the Arcadia Board breached its fiduciary duties by failing to conduct a fair process and the potential dilution of shareholders in the combined company [8]

Core Points - XOMA Royalty Corporation has entered into a definitive share purchase agreement to acquire LAVA Therapeutics N.V. for a cash consideration of between $1.16 and $1.24 per share, plus a contingent value right [1][2] - The acquisition aims to enhance shareholder value by adding economics related to LAVA's partnered programs, particularly those involving gamma delta bispecific antibodies [2] - LAVA's Board of Directors unanimously supports the transaction, believing it to be in the best interests of shareholders and the sustainable success of the business [3] Transaction Details - XOMA Royalty will commence a tender offer by August 15, 2025, to acquire all outstanding shares of LAVA common stock, with the closing contingent on certain conditions, including the tender of at least 80% of shares [4] - Following the tender offer, LAVA will undergo a corporate reorganization to ensure XOMA Royalty acquires 100% of LAVA's shares, with remaining shareholders receiving the same cash and contingent value right [4] - The closing of the transaction is expected in the fourth quarter of 2025 [4] Clinical Program Changes - In connection with the acquisition, LAVA plans to discontinue its Phase 1 clinical trial of LAVA-1266 for acute myeloid leukemia and myelodysplastic syndrome [5] Advisory Information - XOMA Royalty is advised by Gibson, Dunn & Crutcher LLP and Loyens & Loeff N.V., while LAVA is advised by Leerink Partners and Cooley LLP [6] Company Background - XOMA Royalty is a biotechnology royalty aggregator that acquires potential future economics associated with therapeutic candidates licensed to pharmaceutical companies [7] - LAVA Therapeutics is a biopharmaceutical company focused on developing bispecific gamma delta T cell engagers using its proprietary Gammabody platform [9]

BOSTON and EMERYVILLE, Calif., Aug. 04, 2025 (GLOBE NEWSWIRE) -- HilleVax, Inc. ("HilleVax" or "the Company") (NASDAQ: HLVX) and XOMA Royalty Corporation ("XOMA Royalty") (NASDAQ: XOMA) announced today they have entered into a definitive merger agreement (the "Merger Agreement"), whereby XOMA Royalty will acquire all of the issued and outstanding common shares of HilleVax. Under the terms of the Merger Agreement, HilleVax stockholders will receive $1.95 in cash per share of HilleVax common stock at the clos ...

Core Viewpoint - ESSA Pharma Inc. has entered into a definitive agreement with XenoTherapeutics, Inc. for Xeno to acquire all outstanding common shares of ESSA, with the transaction expected to close in the second half of 2025 [1][5]. Transaction Details - ESSA shareholders will receive a cash payment per common share based on ESSA's cash balance at closing, with an estimated total of approximately US$1.91 per common share, excluding contingent value rights (CVR) [2][3]. - Each ESSA shareholder will also receive one non-transferable CVR for each common share, entitling them to a pro rata portion of up to US$2,950,000 (up to US$0.06 per CVR) within 18 months following the transaction's close [2]. - The transaction requires approval from at least 66⅔% of votes cast by ESSA shareholders and securityholders, as well as court approval [5]. Company Strategy - The ESSA Board of Directors believes that the agreement with Xeno and XOMA Royalty maximizes shareholder value and provides a more certain value compared to liquidation [4]. - The transaction is structured to expedite cash distribution to shareholders, with an initial cash distribution application to be made to the Supreme Court of British Columbia [3]. Advisory and Support - Leerink Partners is serving as the exclusive financial advisor to ESSA, with legal counsel provided by Blake, Cassels & Graydon LLP and Skadden, Arps, Slate, Meagher & Flom LLP [9]. - The transaction committee, composed of independent directors, unanimously recommended the agreement to the Board, which has also approved the transaction [7][8]. Company Background - ESSA Pharma Inc. is a pharmaceutical company focused on developing therapies for prostate cancer [10]. - XenoTherapeutics, Inc. is a non-profit biotechnology company focused on advancing xenotransplantation [11]. - XOMA Royalty Corporation is a biotechnology royalty aggregator that supports biotech companies by acquiring future economic rights [12].