Xenon Pharmaceuticals Inc. (Nasdaq:XENE), a neurology-focused
biopharmaceutical company, today reported financial results for the
third quarter ended September 30, 2022 and provided a corporate
update.
Mr. Ian Mortimer, Xenon’s President and Chief
Executive Officer, stated, “We have made significant progress
during the past quarter to support the initiation of our XEN1101
Phase 3 program. XEN1101 represents the most advanced potassium
channel modulator in clinical development, with substantial
clinical efficacy data supporting its advancement for the treatment
of epilepsy. Backed by a strong scientific rationale, we have
ambitious development plans for XEN1101, including the X-TOLE2 and
X-TOLE3 clinical trials in focal onset seizures and the Phase 3
X-ACKT clinical trial in primary generalized tonic clonic seizures
to be conducted in parallel. We continue to hear from key opinion
leaders and prescribing physicians that novel mechanisms are needed
to provide new therapeutic options that are clearly differentiated
from the currently approved anti-seizure medications. Based on the
strength of our Phase 2b efficacy data, our team is committed to
advancing our Phase 3 XEN1101 epilepsy program through clinical
development and towards commercialization, with the goal of
improving the lives of epilepsy patients.”
Mr. Mortimer continued, “Looking ahead, in
parallel with the important ongoing activities to support our
XEN1101 Phase 3 program, 2023 represents another key year for
clinical inflection points within our pipeline. As a result of the
advancements of our XEN1101 MDD study, we have further refined our
guidance with topline data expected in the third quarter of next
year. In addition, our partners at Neurocrine expect to have a
clinical read-out from their Phase 2 study in adult patients with
focal onset seizures in 2023.”
Highlights and Anticipated
Milestones
Proprietary ProgramsXEN1101 is
a differentiated Kv7 potassium channel opener being developed for
the treatment of epilepsy and major depressive disorder (MDD).
XEN1101 for Epilepsy (Focal Onset
Seizures)In October 2021, Xenon announced positive results
from its Phase 2b X-TOLE clinical trial, which evaluated the
clinical efficacy, safety and tolerability of XEN1101 administered
as an adjunctive treatment for adult patients with focal epilepsy.
In June 2022, Xenon announced the successful completion of an
End-of-Phase 2 (EOP2) meeting with the U.S. Food & Drug
Administration (FDA). Based on the EOP2 meeting, Xenon and
the FDA aligned on key elements of the Phase 3 program to support a
New Drug Application (NDA) submission. Xenon plans to submit an NDA
upon completion of the first XEN1101 Phase 3 clinical trial
(X-TOLE2), if successful, and use the existing data package from
the Phase 2b X-TOLE clinical trial along with additional safety
data from other clinical trials to meet regulatory
requirements.
In November 2022, Xenon initiated its XEN1101
Phase 3 development program, which includes two identical Phase 3
clinical trials to be run in parallel, called X-TOLE2 and X-TOLE3,
that are designed closely after the Phase 2b X-TOLE clinical trial.
These multicenter, randomized, double-blind, placebo-controlled
trials will evaluate the clinical efficacy, safety, and
tolerability of XEN1101 administered as adjunctive treatment in
approximately 360 patients per study with focal onset seizures
(FOS). The primary efficacy endpoint is the median percent change
(MPC) in monthly seizure frequency from baseline through the
double-blind period (DBP) of XEN1101 compared to placebo. On
completion of the DBP in X-TOLE2 and X-TOLE3, eligible patients may
enter an open-label extension (OLE) study for up to three years. In
addition, the ongoing X-TOLE OLE also continues to generate
important long-term data for XEN1101 in FOS.
XEN1101 for Epilepsy (Primary
Generalized Tonic Clonic Seizures)Alignment was obtained
with the FDA at the EOP2 meeting on key elements of a single Phase
3 clinical trial to pursue an additional epilepsy indication of
primary generalized tonic clonic seizures (PGTCS). Xenon intends to
initiate a Phase 3 clinical trial, called X-ACKT, to support
potential regulatory submissions in PGTCS. This multicenter,
randomized, double-blind, placebo-controlled study will evaluate
the clinical efficacy, safety, and tolerability of XEN1101
administered as adjunctive treatment in approximately 160 patients
with PGTCS. The primary efficacy endpoint is the MPC in monthly
PGTCS frequency from baseline through the DBP of XEN1101 compared
to placebo. On completion of the DBP in X-ACKT, eligible patients
may enter an OLE study for up to three years.
XEN1101 for Major Depressive
DisorderBased on promising pre-clinical data with XEN1101
and published clinical data generated from both an open-label study
and a randomized, placebo-controlled clinical trial that explored
the targeting of KCNQ channels as a treatment for MDD using
ezogabine, Xenon is evaluating the clinical efficacy, safety and
tolerability of XEN1101 administered as monotherapy in
approximately 150 patients with MDD in a Phase 2 clinical trial
called X-NOVA. Designed as a randomized, double-blind,
placebo-controlled, multicenter clinical study, the primary
objective is to assess the efficacy of XEN1101 compared to placebo
on improvement of depressive symptoms in subjects diagnosed with
moderate to severe MDD, using the Montgomery-Åsberg Depression
Rating Scale (MADRS) score change through week six. Topline
results from the X-NOVA study are anticipated in the third quarter
of 2023.
In addition, Xenon is collaborating with the
Icahn School of Medicine at Mount Sinai to support an ongoing
investigator-sponsored Phase 2 proof-of-concept, randomized,
parallel-arm, placebo-controlled multi-site study of XEN1101 for
the treatment of MDD in approximately 60 subjects. The primary
objective of the study is to investigate the effect of XEN1101 on
the brain reward circuit as measured by the change in bilateral
ventral striatum activity as assessed by functional MRI (fMRI). The
secondary objectives are to test the effect of XEN1101 compared to
placebo on clinical measures of depression and anhedonia using the
MADRS and SHAPS scales.
XEN496XEN496, a Kv7 potassium
channel opener, is a proprietary pediatric formulation of the
active ingredient ezogabine being developed for the treatment of
KCNQ2 developmental and epileptic encephalopathy (KCNQ2-DEE). A
Phase 3 randomized, double-blind, placebo-controlled, parallel
group, multicenter clinical trial, called EPIK, is ongoing to
evaluate the efficacy, safety, and tolerability of XEN496
administered as adjunctive treatment in approximately 40 pediatric
patients aged one month to less than six years with KCNQ2-DEE.
Based on current patient enrollment rates, Xenon now anticipates
that the EPIK study will be completed in 2024.
Partnered Programs
NBI-921352Xenon has an ongoing
collaboration with Neurocrine Biosciences to develop treatments for
epilepsy. Neurocrine Biosciences has an exclusive license to
XEN901, now known as NBI-921352, a selective Nav1.6 sodium channel
inhibitor. Neurocrine Biosciences is conducting a Phase 2 clinical
trial evaluating NBI-921352 in adult patients with focal onset
seizures, with data expected in 2023. In addition, a Phase 2
clinical trial is underway evaluating NBI-921352 in patients aged
between 2 and 21 years with SCN8A developmental and epileptic
encephalopathy (SCN8A-DEE). Pursuant to the terms of the agreement,
Xenon has the potential to receive certain clinical, regulatory,
and commercial milestone payments, as well as future sales
royalties.
Third Quarter 2022 Financial
Results
Cash and cash equivalents and marketable
securities were $752.2 million as of September 30, 2022, compared
to $551.8 million as of December 31, 2021. The increase was
primarily the result of the completion of the Company’s public
offering in June 2022. As of September 30, 2022, there were
62,542,542 common shares and 3,103,864 pre-funded warrants
outstanding.
Based on current assumptions, which include
supporting the XEN1101 clinical development program including the
completion of the planned Phase 3 epilepsy studies, XEN496, and
pre-clinical and discovery programs, Xenon anticipates having
sufficient cash to fund operations into 2026, excluding any revenue
generated from existing partnerships or potential new partnering
arrangements.
For the quarter ended September 30, 2022, Xenon
reported total revenue of $0.1 million, compared to $8.1 million
for the same period in 2021. The decrease of $8.0 million was
primarily attributable to the recognition of a $5.3 million
milestone under the license and collaboration agreement with
Neurocrine Biosciences in the third quarter of 2021, whereas no
milestones were recognized in the third quarter of 2022. In
addition, the research collaboration with Neurocrine Biosciences
ended in June 2022, resulting in a decrease in research and
development services revenue.
Research and development expenses for the
quarter ended September 30, 2022 were $29.4 million, compared to
$18.9 million for the same period in 2021. The increase of $10.5
million was primarily attributable to increased expenses related
our XEN1101 program to support the initiation of the Phase 3
epilepsy program as well as the X-NOVA Phase 2 MDD clinical trial
and increased investment in pre-clinical, discovery and other
internal programs.
General and administrative expenses for the
quarter ended September 30, 2022 were $8.8 million compared to $4.8
million for the same period in 2021. The increase of $4.0 million
was primarily attributable to increased stock-based compensation
expense, salaries and benefits due to an increase in employee
headcount, recruitment fees, insurance premiums and expenses
supporting intellectual property.
Other income for the quarter ended September 30,
2022 was $0.4 million compared to other expense of $0.1 million for
the same period in 2021. The change was primarily attributable to
increased interest income due to a higher balance of marketable
securities and market yields, partially offset by increased foreign
exchange losses due to a higher balance of cash and cash
equivalents and marketable securities denominated in Canadian
dollars and a decline in the value of the Canadian dollar.
Net loss for the quarter ended September 30,
2022 was $37.2 million, compared to $15.4 million for the same
period in 2021. The change was primarily attributable to an
increase in research and development and general and administrative
expenses, lower revenue and higher foreign exchange losses,
partially offset by an increase in interest income.
Conference Call Information
Xenon will host a conference call and audio
webcast today at 4:30 pm Eastern Time (1:30 pm Pacific Time) to
discuss its third quarter results and to provide a corporate
update. The listen-only audio webcast will be broadcast live on the
Investors section of the Xenon website. To participate in the live
call, please register using the following link to receive dial-in
details and a unique PIN code: Register and receive dial-in
details.
About Xenon Pharmaceuticals
Inc.
Xenon Pharmaceuticals (NASDAQ:XENE) is a
clinical stage biopharmaceutical company committed to developing
innovative therapeutics to improve the lives of patients with
neurological disorders. We are advancing a novel product pipeline
of neurology therapies to address areas of high unmet medical need,
with a focus on epilepsy. For more information, please visit
www.xenon-pharma.com.
Safe Harbor Statement
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, and the Private Securities Litigation Reform
Act of 1995 and Canadian securities laws. These forward-looking
statements are not based on historical fact, and include statements
regarding the timing of and potential results from clinical trials;
the potential efficacy, safety profile, future development plans,
addressable market, regulatory success and commercial potential of
our and our partners’ product candidates; the efficacy of our
clinical trial designs; our ability to successfully develop and
achieve milestones in our XEN1101 and other development programs;
the timing and results of our interactions with regulators; our
ability to successfully develop and obtain regulatory approval of
XEN1101 and our other product candidates; anticipated enrollment in
our clinical trials and the timing thereof; and our expectation
that we will have sufficient cash to fund operations into 2026.
These forward-looking statements are based on current assumptions
that involve risks, uncertainties and other factors that may cause
the actual results, events, or developments to be materially
different from those expressed or implied by such forward-looking
statements. These risks and uncertainties, many of which are beyond
our control, include, but are not limited to: clinical trials may
not demonstrate safety and efficacy of any of our or our
collaborators’ product candidates; promising results from
pre-clinical development activities or early clinical trial results
may not be replicated in later clinical trials; our
assumptions regarding our planned expenditures and sufficiency of
our cash to fund operations may be incorrect; our ongoing discovery
and pre-clinical efforts may not yield additional product
candidates; any of our or our collaborators’ product candidates,
including XEN1101 may fail in development, may not receive required
regulatory approvals, or may be delayed to a point where they are
not commercially viable; we may not achieve additional milestones
in our proprietary or partnered programs; regulatory agencies may
impose additional requirements or delay the initiation of clinical
trials; the impact of competition; the impact of expanded product
development and clinical activities on operating expenses; the
impact of new or changing laws and regulations; the impact of the
ongoing COVID-19 pandemic on our research and clinical development
plans and timelines and results of operations, including impact on
our clinical trial sites, collaborators, regulatory agencies and
related review times, and contractors who act for or on our behalf,
may be more severe and more prolonged than currently anticipated;
the impact of the COVID-19 pandemic on our business; the impact of
unstable economic conditions in the general domestic and global
economic markets; adverse conditions from geopolitical events; as
well as the other risks identified in our filings with the
Securities and Exchange Commission and the securities commissions
in British Columbia, Alberta, and Ontario. These forward-looking
statements speak only as of the date hereof and we assume no
obligation to update these forward-looking statements, and readers
are cautioned not to place undue reliance on such forward-looking
statements.
“Xenon” and the Xenon logo are registered
trademarks or trademarks of Xenon Pharmaceuticals Inc. in various
jurisdictions. All other trademarks belong to their respective
owner.
XENON PHARMACEUTICALS INC.Condensed Consolidated
Balance Sheets(Expressed in thousands of U.S. dollars)
|
|
September 30, |
|
|
December 31, |
|
|
|
2022 |
|
|
2021 |
|
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents and marketable securities |
|
$ |
638,185 |
|
|
$ |
551,774 |
|
Other current assets |
|
|
10,991 |
|
|
|
7,246 |
|
Marketable securities, long
term |
|
|
113,989 |
|
|
|
— |
|
Other assets |
|
|
12,648 |
|
|
|
12,987 |
|
Total assets |
|
$ |
775,813 |
|
|
$ |
572,007 |
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable and accrued expenses |
|
$ |
15,537 |
|
|
$ |
13,717 |
|
Other current liabilities |
|
|
— |
|
|
|
605 |
|
Other liabilities |
|
|
7,157 |
|
|
|
7,652 |
|
Total liabilities |
|
$ |
22,694 |
|
|
$ |
21,974 |
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
$ |
753,119 |
|
|
$ |
550,033 |
|
Total liabilities and shareholders’ equity |
|
$ |
775,813 |
|
|
$ |
572,007 |
|
|
XENON PHARMACEUTICALS INC.Condensed Consolidated
Statements of Operations and Comprehensive Loss(Expressed in
thousands of U.S. dollars except share and per share amounts)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September
30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Revenue |
|
$ |
132 |
|
|
$ |
8,124 |
|
|
$ |
9,434 |
|
|
$ |
14,700 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
29,431 |
|
|
|
18,891 |
|
|
|
70,937 |
|
|
|
53,576 |
|
General and administrative |
|
|
8,829 |
|
|
|
4,831 |
|
|
|
24,309 |
|
|
|
15,279 |
|
Total operating expenses |
|
|
38,260 |
|
|
|
23,722 |
|
|
|
95,246 |
|
|
|
68,855 |
|
Loss from operations |
|
|
(38,128 |
) |
|
|
(15,598 |
) |
|
|
(85,812 |
) |
|
|
(54,155 |
) |
Other (expense) income |
|
|
391 |
|
|
|
(52 |
) |
|
|
(3,187 |
) |
|
|
347 |
|
Loss before income taxes |
|
|
(37,737 |
) |
|
|
(15,650 |
) |
|
|
(88,999 |
) |
|
|
(53,808 |
) |
Income tax recovery |
|
|
587 |
|
|
|
205 |
|
|
|
1,021 |
|
|
|
490 |
|
Net loss |
|
|
(37,150 |
) |
|
|
(15,445 |
) |
|
|
(87,978 |
) |
|
|
(53,318 |
) |
Net loss attributable to preferred shareholders |
|
|
— |
|
|
|
(362 |
) |
|
|
(420 |
) |
|
|
(1,308 |
) |
Net loss attributable to common shareholders |
|
$ |
(37,150 |
) |
|
$ |
(15,083 |
) |
|
$ |
(87,558 |
) |
|
$ |
(52,010 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss: |
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized losses on available-for-sale
securities |
|
$ |
(1,965 |
) |
|
$ |
— |
|
|
$ |
(1,965 |
) |
|
$ |
— |
|
Comprehensive loss |
|
$ |
(39,115 |
) |
|
$ |
(15,445 |
) |
|
$ |
(89,943 |
) |
|
$ |
(53,318 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
$ |
(0.57 |
) |
|
$ |
(0.36 |
) |
|
$ |
(1.49 |
) |
|
$ |
(1.29 |
) |
Weighted-average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
65,465,069 |
|
|
|
42,274,348 |
|
|
|
58,836,928 |
|
|
|
40,396,391 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investor/Media Contact:Jodi Regts Xenon
Pharmaceuticals Inc. Phone: 604.484.3353 Email:
investors@xenon-pharma.com
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