What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-02-24 compared with 2025-02-24 · 105 added, 146 removed, 175 unchanged (59% of the section changed)

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Refer to Part I, Item 1, "XmAb Bispecific Fc Domain and New Multi-Specific Antibody Formats" and "Other XmAb Fc Domains" in the description of our business included in our Annual Report on Form 10-K/A for the year ended December 31, 2023 for a discussion of our core Fc technology platforms.

Clinical-Stage XmAb Drug Candidates in Oncology

Clinical-Stage XmAb Drug Candidates

Our modular XmAb bispecific technology and protein engineering capabilities enable us to rapidly advance multiple drug candidates into clinical development.

We are currently enrolling Phase 1 or Phase 2 studies for four wholly-owned candidates to treat patients with many different types of serious diseases.

Vudalimab (PD-1 x CTLA-4):

Vudalimab is a bispecific antibody that targets PD-1 and CTLA-4, two immune checkpoint receptors, to selectively activate the tumor microenvironment, and it is being developed for patients with metastatic castration-resistant prostate cancer (mCRPC) and patients with locally advanced or metastatic non-small cell lung cancer.

Data from a Phase 1 study that enrolled heavily pretreated patients with multiple solid tumor types indicated that vudalimab was generally well-tolerated with encouraging clinical activity.

We are conducting a Phase 2 study of vudalimab in patients with mCRPC, as a monotherapy or in combination with chemotherapy for patients with aggressive variant prostate cancer, as these patients represent a high unmet medical need.

We are also conducting a second Phase 2 study in patients with clinically-defined high-risk mCRPC, in which initial data indicates that vudalimab monotherapy has been generally well tolerated and associated with response to treatment in multiple patients who have visceral or lymph node metastases.

In March 2024, we disclosed additional clinical data showing characteristics of patients with clinical response (n=5/12) and per label rates of immune-mediated hepatitis for ipilimumab (anti-CTLA-4;

1 mg/kg) + nivolumab (anti-PD-1;

3 mg/kg) combination treatment, as generally comparable to the rate of all hepatobiliary disorder adverse events including immune-mediated hepatitis for vudalimab among all patients treated at doses greater than or equal to 10 mg/kg.

We are also conducting a Phase 1b/2 study evaluating vudalimab as a first-line treatment in patients with locally advanced or metastatic non-small cell lung cancer.

XmAb819 (ENPP3 x CD3) :

XmAb819 is designed to engage the immune system, activating T cells for highly potent and targeted killing of tumor cells expressing ENPP3, an antigen highly expressed on kidney cancers.

Xencor’s XmAb 2+1 multivalent format used in XmAb819 enables greater selectivity of ENPP3-expressing tumor cells compared to normal cells, which express lower levels of ENPP3.

We are currently conducting a Phase 1 study to evaluate XmAb819 in patients with advanced clear cell RCC.

In September 2024, we announced that initial evidence of anti-tumor activity was observed in recent dose-escalation cohorts in the ongoing Phase 1 study, including RECIST responses, and the duration of treatment for several patients in earlier dose cohorts has extended beyond one year.

Cytokine release syndrome remained manageable, and the tolerability profile from recent dose cohorts, including no maximum tolerated dose being reached, supported continued dose escalation toward target dose levels.

We continue to anticipate reaching target dose levels by year end and plan to provide a clinical update around initiation of the first dose expansion cohort during the first half of 2025.

XmAb819 is a bispecific T-cell engager that targets ENPP3, a tumor-associated antigen in renal cell carcinoma (RCC), and CD3, an activating receptor on T cells.

The XmAb 2+1 multivalent format used in XmAb819 enables greater selectivity for ENPP3 expressing tumor cells compared to normal cells, which also express ENPP3 at lower levels.

We are currently enrolling a Phase 1 study to evaluate XmAb819 in patients with advanced clear cell RCC.

XmAb808 (B7-H3 x CD28):

XmAb808 is a tumor-selective, co-stimulatory CD28 bispecific antibody that binds to the broadly expressed tumor antigen B7-H3 and is constructed with the XmAb 2+1 format.

Co-stimulation is required for T cells to achieve full activation, and targeted CD28 bispecific antibodies may provide conditional co-stimulation of T cells when the antibodies are bound to tumor cells.

XmAb808 is a tumor-selective, co-stimulatory XmAb 2+1 bispecific T-cell engager designed to bind to the broadly expressed tumor antigen B7-H3 and selectively to the CD28 T-cell co-receptor only when bound to tumor cells.

We are conducting a Phase 1 study to evaluate XmAb808 in combination with pembrolizumab in patients with advanced solid tumors.

In September 2024, we announced that in the ongoing Phase 1 dose-escalation study, in a group of patients with metastatic castration-resistant prostate cancer (mCRPC), prostate specific antigen (PSA) declines were observed during the four-week monotherapy safety run-in period.

In the highest dose cohort to date, within the range of expected active doses, two patients experienced dose-limiting toxicities as defined in the study protocol.

The maximum tolerated dose has not been defined per protocol.

As the data from these recent events are analyzed, back-fill enrollment is proceeding in the next lower dose cohort, a dose within the range of target doses, which was determined to be tolerable.

The Company plans to provide a clinical update around initiation of dose expansion cohorts during the first half of 2025.

XmAb541 (CLDN6 x CD3):

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The XmAb 2+1 multivalent format used in XmAb541 enables greater selectivity for CLDN6 over similar Claudin family members, such as CLDN9, CLDN3 and CLDN4.

We are currently conducting a Phase 1 study to evaluate XmAb541 in patients with ovarian cancer and other CLDN6 expressing tumor types.

We are currently enrolling a Phase 1 study to evaluate XmAb541 in patients with ovarian cancer and other CLDN6 expressing tumor types.

The first patient was dosed in April 2024.

Through 2025, we plan to advance the ongoing Phase 1 dose-escalation study toward target dose levels.

Vudalimab (PD-1 x CTLA-4):

Data from a Phase 1 study that enrolled heavily pretreated patients with multiple solid tumor types indicated that vudalimab was generally well-tolerated with encouraging clinical activity.

We are conducting two Phase 2 studies of vudalimab in patients with mCRPC who have progressed beyond current standard of care options, as a monotherapy or in combination with chemotherapy, and we anticipate a data readout from these studies in the first half of 2025.

We are also conducting a Phase 1b/2 study evaluating vudalimab in combination with chemotherapy as a first-line treatment in patients with locally advanced or metastatic non-small cell lung cancer, and we plan to evaluate the safety of the combination in the first half of 2025.

Additional Clinical-Stage Candidate Previously Co-Developed with Partner

Efbalropendekin alfa (IL15/IL15Rα-Fc Cytokine):

Efbalropendekin alfa (XmAb306/RG6323) is a reduced-potency IL15/IL15Rα-Fc fusion protein that incorporates our Xtend extended half-life technology, and we previously co-developed this program in collaboration with Genentech, a member of the Roche Group.

Genentech is conducting a Phase 1 study evaluating efbalropendekin in patients with relapsed/refractory multiple myeloma in combination with cevostamab (FcRH5 x CD3 bispecific antibody).

In the fourth quarter of 2023, we agreed with Genentech to convert our current development cost and profit-sharing arrangement into a royalty and milestone payment-based arrangement.

Pursuant to the terms of the amended agreement with Genentech, effective June 1, 2024, Genentech assumed sole responsibility over all clinical, regulatory and commercial activities.

We are eligible for up to $600.0 million in milestones and tiered royalties on approved sales from low double-digit to mid-teen percentages range.

XmAb Drug Candidates for the Treatment of Patients with Autoimmune and Inflammatory Diseases and Planned Clinical Studies

In September 2024, we announced new clinical development plans for plamotamab and announced new XmAb drug candidates to be evaluated for the treatment of patients with autoimmune and inflammatory diseases.We believe that plamotamab and XmAb657 could address significant unmet needs for patients with a wide-range of autoimmune diseases that could be responsive to targeted B-cell depletion, such as rheumatoid arthritis, multiple sclerosis, advanced systemic lupus erythematosus, anti-neutrophil cytoplasmic antibody (ANCA)-associated vasculitis, idiopathic inflammatory myopathy, myasthenia gravis, neuromyelitis optica spectrum disorder, pemphigus vulgaris, Sjogren’s syndrome, and systemic sclerosis.

We believe that XmAb942 and a drug candidate to potentially emerge from the XmAb TL1A x IL-23 program could address significant unmet medical needs for patients with inflammatory bowel disease (IBD), such as Crohn’s disease and ulcerative colitis, the two most common forms of IBD.

XmAb564 (IL2-Fc Cytokine):

XmAb564 is a monovalent interleukin-2 Fc (IL-2-Fc) fusion protein engineered to selectively activate and expand regulatory T cells (Tregs) for the potential treatment of patients with autoimmune diseases.

In the first half of 2024, we concluded a Phase 1b study that was evaluating the safety and tolerability of multiple ascending doses of XmAb564, administered subcutaneously in patients, and we have paused further development.

XmAb662 (IL12-Fc Cytokine):

XmAb662 is a potency-reduced interleukin-12 Fc (IL12-Fc) fusion protein engineered to increase anti-tumor activity and immunogenicity in the tumor microenvironment by promoting high levels of interferon gamma secretion from T cells and NK cells.

In the first half of 2024, we concluded a Phase 1 study that was evaluating XmAb662 in patients with advanced solid tumors, and we have paused further development.

Candidates Previously Co-Developed with Partners

Plamotamab (CD20 x CD3):

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We had been co-developing plamotamab with Johnson & Johnson (J&J), and in June 2024, we regained exclusive worldwide rights to develop and commercialize the candidate.

We plan to initiate a Phase 1b/2a proof-of-concept study for plamotamab in rheumatoid arthritis (RA) in the first half of 2025.

The Phase 1b portion of the study will select a priming and step-up dose regimen based on the regimen established in oncology, and will assess the initial safety, efficacy, and biomarkers of plamotamab in patients with RA.

The selected dose regimen will then be evaluated in the randomized Phase 2a portion, with efficacy determined at week 24.

We previously completed a Phase 1 clinical study of plamotamab in hematologic cancers, completing enrollment in late 2023.

Results from the study showed favorable tolerability and comparable preliminary efficacy data, when cross compared to results from studies of a competitor molecule within the class, with similar patient baseline characteristics.

Based on these clinical outcomes, significant B-cell depletion observed in preclinical studies, and the emergent biology supportive of B-

cell targeted T cell engagers for the treatment of patients with autoimmune diseases, we plan to evaluate plamotamab in RA, in which patients progressed through prior standard of care treatment.

XmAb657 (CD19 x CD3):

We have leveraged our XmAb protein engineering platforms to create XmAb657, a potent, potentially long-acting CD19 x CD3 bispecific antibody, utilizing the XmAb 2+1 bispecific antibody format and Xtend Fc technology.

In non-human primate studies, a single dose of XmAb657 deeply reduced B cells by over 99.98% in the peripheral compartment, bone marrow and lymph nodes, which was sustained for at least 28 days.

Half-life was estimated to be 15 days, which indicates a potential for durable B-cell depletion in clinical studies.

XmAb657 was well tolerated preclinically, with no clinical signs of cytokine release syndrome.

We plan to initiate a first-in-human study during the second half of 2025.

XmAb942 (Xtend TL1A):

XmAb924 is a monospecific anti-TL1A antibody, utilizing Xencor’s Xtend Fc domain and proprietary Fc silencing technology, with potentially class-leading potency, and is under development for patients with IBD.

The two most common forms of IBD are Crohn’s disease and ulcerative colitis.

In October 2024, preclinical data were presented during United European Gastroenterology (UEG) Week.

Half-life preclinically was 23 days, potentially supporting an 8- to 12-week dosing regimen in humans.

In the fourth quarter of 2024, we initiated dosing of healthy volunteers in the first-in-human study of XmAb942, and we continue to expect initial data from the ongoing study during the first half of 2025.

XmAb TL1A x IL-23:

An expertly engineered XmAb TL1A x IL-23p19 bispecific antibody could potentially provide dual targeting of important inflammatory pathways for autoimmune and inflammatory disease, while avoiding the complexities of dosing and formulary access for two separate TL1A and IL23 targeted drugs.

We anticipate initiating first-in-human studies during 2026.

We are reviewing plamotamab's potential for addressing the unmet medical needs of patients.

Efbalropendekin alfa (IL15/IL15Rα-Fc Cytokine):

Genentech is conducting a Phase 1 study of efbalropendekin as a single agent and in combination with atezolizumab in patients with advanced solid tumors and is also conducting a Phase 1 study evaluating efbalropendekin in patients with relapsed/refractory multiple myeloma in combination with cevostamab (FcRH5 x CD3 bispecific antibody).

In the fourth quarter of 2023, we agreed with Genentech to convert our current development cost and profit-sharing arrangement into a royalty and milestone payment-based arrangement.

Pursuant to the terms of the amended agreement with Genentech, effective June 1, 2024, Genentech assumed sole responsibility over all clinical, regulatory and commercial activities.

We are eligible for up to $600.0 million in milestones and tiered royalties on approved sales from low double-digit to mid-teen percentages range.

Advancements Expanding XmAb Bispecific Platforms

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JNJ-9401 and JNJ-1493 are clinical-stage XmAb bispecific antibodies that J&J is developing in prostate cancer and B-cell malignancies, respectively, and both entered clinical development during the fourth quarter of 2023.

In the first quarter of 2024, we amended the MorphoSys Agreement, which included releasing us from certain exclusivity obligations relating to CD19, and we advanced XmAb657 (CD19 x CD3) into preclinical development.

In the first quarter of 2024, we amended the MorphoSys Agreement, which included releasing us from certain exclusivity obligations relating to CD19.

Progress Across Partnerships

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co-development options;

and the right to conduct studies with drug candidates developed in the collaboration.

the right to conduct studies with drug candidates developed in the collaboration.

The types of arrangements that we have entered into with partners include product licenses, novel bispecific antibody collaborations, technology licensing agreements and strategic collaborations.

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In August 2021, the European Commission granted conditional marketing authorization for Minjuvi® (tafasitamab) in combination with lenalidomide, followed by tafasitamab monotherapy, for the treatment of adult patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) who are not eligible for autologous stem cell transplantation (ASCT).

In August 2024, Incyte announced positive topline results from the pivotal study of tafasitamab in relapsed or refractory follicular lymphoma (FL);

based on these results Incyte expects to file a supplemental Biologics License Application for tafasitamab in combination with lenalidomide and rituximab in FL by the end of the 2024.

Tafasitamab was created and initially developed by us.

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In February 2024, Incyte acquired exclusive global development and commercialization rights to tafasitamab from MorphoSys AG.

We earned $2.1 million in estimated non-cash royalties from Incyte for the three months ended September 30, 2024.

Novel Bispecific Antibody Collaborations

Novel bispecific antibody collaborations are arrangements in which our partner seeks to create a bispecific antibody using one or more of our XmAb bispecific technologies.

Our partners provide an antibody or a tumor-associated antigen, and we conduct limited research and development to create potential bispecific antibody candidates for further development and commercialization by our partners.

Xaluritamig is a STEAP1 x CD3 2+1 XmAb bispecific T-cell engager that our partner Amgen is advancing for the treatment of patients with prostate cancer.

The XmAb 2+1 multivalent format enables higher binding capability for STEAP1 expressing cells.

Results from a Phase 1 study evaluating xaluritamig in patients with mCRPC were presented at the European Society for Medical Oncology (ESMO) Congress in September 2024.

With a median follow-up time of 27.9 months, the median overall survival (OS) was 17.7 months across all cohorts.

A PSA90 rate of 45.1% was also observed in high-dose cohorts, and PSA90 response was associated with survival (p = 0.0044), which Amgen believes could potentially serve as an early indicator for benefit in these patients.

Amgen has indicated that a Phase 3 study in patients with post-taxane mCRPC will be initiated in the fourth quarter of 2024.

Multiple Phase 1 studies evaluating xaluritamig as a monotherapy or in combination are enrolling patients with earlier prostate cancer.

We earned $1.6 million in estimated non-cash royalties from MorphoSys for the three months ended June 30, 2024.

Technology License Agreements

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for the treatment of adult patients with anti-aquaporin-4 antibody-positive NMOSD in March 2024.

Alexion is also evaluating Ultomiris in a broad development program across additional hematology, nephrology and neurology indications.

We earned a total of $15.7 million in estimated non-cash royalties from Alexion for the three months ended September 30, 2024.

Alexion is also evaluating Ultomiris in a broad development program across additional hematology and neurology indications.

We earned a total of $13.8 million in estimated non-cash royalties from Alexion for the three months ended June 30, 2024.

Refer to Part I, Item 1, Note 10, Collaboration and Licensing Agreements of the Notes to Financial Statements included in this Form 10-Q/A for a description of the key terms of our arrangements.

Discontinued Programs

XmAb564 (IL2-Fc Cytokine):

XmAb564 is a monovalent interleukin-2 Fc (IL2-Fc) fusion protein engineered to selectively activate and expand regulatory T cells (Tregs) for the potential treatment of patients with autoimmune diseases.

XmAb662 (IL12-Fc Cytokine):

In the first half of 2024, we concluded a Phase 1 study that was evaluating XmAb662 in patients with advanced solid tumors, and we have paused further development.

We have over 1,500 issued and pending patents worldwide to protect our XmAb technology platform and XmAb drug candidates.

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To date, we have funded our operations primarily through the sale of stock and from payments generated from our product development partnerships and licensing arrangements.

As of September 30, 2024, we had an accumulated deficit of $658.5 million.

As of June 30, 2024, we had an accumulated deficit of $612.2 million.

Substantially all of the operating losses that we have incurred resulted from expenses incurred in connection with our product candidate development programs, our research activities and general and administrative costs associated with our operations.

Results of Operations

Comparison of the Three Months Ended September 30, 2024 and 2023

The following table summarizes our results of operations for the three months ended September 30, 2024 and 2023 (in millions):

Comparison of the Three Months Ended June 30, 2024 and 2023

The following table summarizes our results of operations for the three months ended June 30, 2024 and 2023 (in millions):

Three Months Ended

September 30,

2024 2023 Change

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Other income (expense), net (13.4) 4.0 (17.4)

Loss before income tax expense

(68.7) (22.0) (46.7)

Income tax expense — — —

Net loss (68.7) (22.0) (46.7)

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$ (67.3) $ (22.0) $ (45.3)

Revenues for the three months ended September 30, 2024 are primarily from non-cash royalty revenue from Alexion and MorphoSys/Incyte.

Revenues for the three months ended September 30, 2023 are primarily from royalty and milestone revenue from Alexion, and milestone revenue from Janssen, Gilead and Omeros.

Based on updated information regarding our measure of progress in completing research activities, we effected a change in estimate under ASC 606 which resulted in adjusted research revenue for the three months ended September 30, 2023.

Revenues for the three months ended June 30, 2024 are primarily from licensing revenue from Mabgeek and a third-party licensee as well as non-cash royalty revenue from Alexion and MorphoSys/Incyte.

Revenues for the three months ended June 30, 2023 are primarily from research revenue from our second collaboration with Janssen, royalty revenue from Alexion, and milestone revenue from Zenas.

Research and Development Expenses

The following tables summarize our research and development expenses for the three months ended September 30, 2024 and 2023 (in millions):

The following tables summarize our research and development expenses for the three months ended June 30, 2024 and 2023 (in millions):

Three Months Ended

September 30,

2024 2023 Change

Product programs:

Vudalimab (PD-1 x CTLA-4) $ 12.7 $ 10.1 $ 2.6

Bispecific programs:

CD3 programs:

Plamotamab* $ 2.8 $ 4.1 $ (1.3)

XmAb819 (ENPP3 x CD3) 6.8 4.8 2.0

XmAb808 (B7-H3 x CD28) 5.8 4.0 1.8

XmAb541 (CLDN6 X CD3) 4.5 6.3 (1.8)

Plamotamab (CD20 x CD3)* 6.4 3.5 2.9

XmAb942 (Xtend TL1A) 9.2 — 9.2

XmAb657 (CD19 x CD3) 2.2 — 2.2

Efbalropendekin alfa (IL15/IL15Ra-Fc)* (0.1) 5.3 (5.4)

Total CD3 programs 14.1 15.2 (1.1)

XmAb808 (B7-H3 x CD28) 5.2 4.3 0.9

Tumor micro environment (TME) activator programs:

Vudalimab 12.2 9.6 2.6

XmAb104 0.7 5.8 (5.1)

Total TME activators programs 12.9 15.4 (2.5)

Subtotal bispecific programs 32.2 34.9 (2.7)

Cytokine programs:

XmAb306/RG6323 programs* 4.9 (0.5) 5.4

XmAb564 2.3 5.9 (3.6)

XmAb662 (IL-12-Fc) 2.0 3.8 (1.8)

Total cytokine programs 9.2 9.2 —

Other, research and early stage programs 19.9 14.7 5.2

Wind down costs of terminated programs (1)

0.2 1.2 (1.0)

Total research and development expenses $ 61.5 $ 60.0 $ 1.5

*Includes net reimbursements to and from our partners pursuant to agreements that include cost-sharing arrangements.

(1) Research and development expenses include wind down costs of terminated programs including the vibecotamab, tidutamab, XmAb841, XmAb104, XmAb662, and XmAb564 programs.

(1) Research and development expenses include wind down costs of programs that terminated in prior periods including the vibecotamab, tidutamab, and XmAb841 programs.

Three Months Ended

September 30,

2024 2023 Change

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Total research and development expenses $ 61.5 $ 60.0 $ 1.5

Research and development expenses decreased by $6.7 million for the three months ended September 30, 2024 over the same period in 2023 primarily due to decreased spending on the wind down costs of terminated programs, partially offset by increased spending on our programs such as XmAb942, XmAb819, and plamotamab.

Research and development expenses increased by $1.5 million for the three months ended June 30, 2024 over the same period in 2023 primarily due to increased spending on other research and early stage programs, partially offset by decreased spending on our XmAb104 program.

General and Administrative Expenses

The following table summarizes our general and administrative expenses for the three months ended September 30, 2024 and 2023 (in millions):

The following table summarizes our general and administrative expenses for the three months ended June 30, 2024 and 2023 (in millions):

Three Months Ended

September 30,

2024 2023 Change

General and administrative $ 17.7 $ 11.5 $ 6.2

General and administrative expenses increased by $2.3 million for the three months ended September 30, 2024 over the same period in 2023 primarily due to increased spending on staffing and professional fees.

General and administrative expenses increased by $6.2 million for the three months ended June 30, 2024 over the same period in 2023 primarily due to increased spending on corporate activities, including stock-based compensation costs related to the extension of vesting periods and expiration dates of equity awards for employees who retired in April 2024.

Other Income (Expense), Net

Other income, net was $7.8 million for the three months ended September 30, 2024, which consists of unrealized and realized gains recognized from the change in fair value and the sale of our equity investments and interest income earned on investments, partially offset by non-cash interest expense from the Ultomiris and Monjuvi Royalty Sale Agreements.

Other expense, net was $6.0 million for the three months ended September 30, 2023, which consists primarily of unrealized loss on equity investments in excess of interest income earned on investments.

Comparison of the Nine Months Ended September 30, 2024 and 2023

The following table summarizes our results of operations for the nine months ended September 30, 2024 and 2023 (in millions):

Nine Months Ended

September 30,

Other (expense), net was $(13.4) million for the three months ended June 30, 2024, which consists of unrealized and realized losses recognized from the change in fair value and the sale of our equity investments and non-cash interest expense from the Ultomiris and Monjuvi Royalty Sale Agreements, partially offset by interest income earned on investments.

Other income, net was $4.0 million for the three months ended June 30, 2023, which consists primarily of interest income earned on investments.

Comparison of the Six Months Ended June 30, 2024 and 2023

The following table summarizes our results of operations for the six months ended June 30, 2024 and 2023 (in millions):

Six Months Ended

2024 2023 Change

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$ (140.8) $ (82.7) $ (58.1)

Revenues for the nine months ended September 30, 2024 are primarily licensing revenue from Mabgeek and a third-party licensee as well as non-cash royalty revenue from Alexion and MorphoSys/Incyte.

Revenues for the nine months ended September 30, 2023 are primarily from research revenue from our second collaboration with Janssen, royalty and milestone revenue from Alexion, and milestone revenue from Janssen, Omeros, Gilead and Zenas.

Revenues for the six months ended June 30, 2024 are primarily licensing revenue from Mabgeek and a third-party licensee as well as non-cash royalty revenue from Alexion and MorphoSys.

Revenues for the six months ended June 30, 2023 are primarily from research revenue from our second collaboration with Janssen, royalty revenue from Alexion, and milestone revenue from Janssen and Zenas.

Research and Development Expenses

The following tables summarize our research and development expenses for the nine months ended September 30, 2024 and 2023 (in millions):

Nine Months Ended

September 30,

The following tables summarize our research and development expenses for the six months ended June 30, 2024 and 2023 (in millions):

Six Months Ended

2024 2023 Change

Product programs:

Vudalimab (PD-1 x CTLA-4) $ 36.3 $ 27.4 $ 8.9

Bispecific programs:

CD3 programs:

Plamotamab* $ 5.0 $ 9.8 $ (4.8)

XmAb819 (ENPP3 x CD3) 13.1 9.3 3.8

XmAb808 (B7-H3 x CD28) 16.3 12.2 4.1

XmAb541 (CLDN6 X CD3) 7.0 10.9 (3.9)

Plamotamab (CD20 x CD3)* 11.4 13.3 (1.9)

XmAb942 (Xtend TL1A) 25.4 — 25.4

XmAb657 (CD19 x CD3) 2.4 — 2.4

Efbalropendekin alfa (IL15/IL15Ra-Fc)* 10.3 9.8 0.5

Total CD3 programs 25.1 30.0 (4.9)

XmAb808 (B7-H3 x CD28) 10.5 8.1 2.4

Tumor micro environment (TME) activator programs:

Vudalimab 23.7 17.3 6.4

XmAb104 3.2 13.0 (9.8)

Total TME activators programs 26.9 30.3 (3.4)

Subtotal bispecific programs 62.5 68.4 (5.9)

Cytokine programs:

XmAb306/RG6323 programs* 10.4 4.5 5.9

XmAb564 6.8 12.5 (5.7)

XmAb662 (IL-12-Fc) 4.8 7.0 (2.2)

Total cytokine programs 22.0 24.0 (2.0)

Other, research and early stage programs 33.2 28.9 4.3

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*Includes net reimbursements to and from our partners pursuant to agreements that include cost-sharing arrangements.

(1) Research and development expenses include wind down costs of terminated programs including the vibecotamab, tidutamab, XmAb841, XmAb104, XmAb662, and XmAb564 programs.

Nine Months Ended

September 30,

(1) Research and development expenses include wind down costs of programs that terminated in prior periods including the vibecotamab, tidutamab, and XmAb841 programs.

Six Months Ended

2024 2023 Change

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Total research and development expenses $ 118.4 $ 125.6 $ (7.2)

Research and development expenses decreased by $14.0 million for the nine months ended September 30, 2024 over the same period in 2023 primarily due to decreased spending on the wind down costs of terminated programs, partially offset by increased spending on programs such as vudalimab, XmAb819, and XmAb808.

Research and development expenses decreased by $7.2 million for the six months ended June 30, 2024 over the same period in 2023 primarily due to decreased spending on our XmAb104 program, partially offset by increased spending on other research and early stage programs.

General and Administrative Expenses

The following table summarizes our general and administrative expenses for the nine months ended September 30, 2024 and 2023 (in millions):

Nine Months Ended

September 30,

The following table summarizes our general and administrative expenses for the six months ended June 30, 2024 and 2023 (in millions):

Six Months Ended

2024 2023 Change

General and administrative $ 31.5 $ 25.6 $ 5.9

General and administrative expenses increased by $8.2 million for the nine months ended September 30, 2024 over the same period in 2023 primarily due to increased corporate activities including stock-based compensation costs related to the extension of vesting periods and expiration dates of equity awards for employees who retired in April 2024.

General and administrative expenses increased by $5.9 million for the six months ended June 30, 2024 over the same period in 2023 primarily due to increased corporate activities including stock-based compensation costs related to the extension of vesting periods and expiration dates of equity awards for employees who retired in April 2024.

Other Income (Expense), Net

Other (expense), net was $(25.1) million for the nine months ended September 30, 2024, which consists primarily of an impairment charge on Zenas and non-cash interest expense from the Ultomiris and Monjuvi Royalty Sale Agreements, partially offset by interest income earned on investments.

Other expense, net for the same period in 2023 was $2.0 million, which consists primarily of unrealized loss recognized from the change in fair value of our equity investments, partially offset by interest income earned on investments.

Other income (expense), net was $(32.9) million and $4.0 million for the six months ended June 30, 2024 and 2023, respectively.

Other expense, net for the six months ended June 30, 2024 consists of an impairment charge on Zenas, our equity investment without a readily determinable fair value, unrealized and realized losses recognized from the change in fair value and the sale of our other equity investments with readily determinable fair values, and non-cash interest expense from the Ultomiris and Monjuvi Royalty Sale Agreements, partially offset by interest income earned on investments.

Other income, net for the same period in 2023 consists primarily of interest income earned on investments, partially offset by unrealized loss recognized from the change in fair value of our equity investments.

The following table sets forth the primary sources and uses of cash for each of the periods presented below (in thousands):

Nine Months Ended

September 30,

Six Months Ended

2024 2023 Change

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Operating Activities

Cash used in operating activities for the nine months ended September 30, 2024 and 2023 was $152.4 million and $96.1 million, respectively.

The increase in cash used in operating activities is primarily due to lower research and milestone revenues and the decrease in royalty revenue received as a result of the sale of future royalties under the Ultomiris and Monjuvi Royalty Sale Agreements in 2023, partially offset by lower spending in the nine months ended September 30, 2024.

Cash used in operating activities for the six months ended June 30, 2024 and 2023 was $124.2 million and $68.8 million, respectively.

The increase in cash used in operating activities is due to the decrease in royalty revenue received as a result of the sale of future royalties under the Ultomiris and Monjuvi Royalty Sale Agreements in 2023 and higher spending in the six months ended June 30, 2024.

Investing Activities

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Financing Activities

Net cash provided by financing activities for the nine months ended September 30, 2024 increased by $189.5 million over the same period in 2023, which reflects proceeds received from our September 2024 financing, partially offset by the reduction in our liabilities under the Ultomiris and Monjuvi Royalty Sale Agreements.

Net cash provided by financing activities for the six months ended June 30, 2024 and 2023 are from the net proceeds from the exercise of stock options and purchase of ESPP.

Liquidity and Capital Resources

We have financed our operations primarily through private placements of our equity securities, the issuance of convertible notes, public offerings of our common stock, and payments received under our product development partnerships and licensing arrangements.

On February 27, 2023, we filed an automatic universal shelf registration statement on Form S-3 (File No.

333-270030) as a well-known seasoned issuer as defined in Rule 405 under the Securities Act of 1933, as amended, which became effective upon filing (the Shelf Registration Statement).

The Shelf Registration Statement allows us to offer an indeterminate amount of securities, including equity securities, debt securities, warrants, rights, units and depositary shares, from time to time as described in the Shelf Registration Statement.

From time to time, we may offer securities under the Registration Statement in response to market conditions or other circumstances if we believe such a plan of financing is in the best interests of our stockholders.

The specific terms of any offering under the Shelf Registration Statement will be established at the time of such offering.

The Shelf Registration Statement will expire on February 27, 2026.

On February 27, 2023, we entered into a Sales Agreement (the Sales Agreement) with SVB Securities LLC (the Sales Agent), pursuant to which we may issue and sell through the Sales Agent shares of common stock (the ATM Offering), subject to the limitations set forth in the Sales Agreement.

We are not obligated to make any sales of common stock under the Sales Agreement.

We will pay a commission not to exceed 3.0% of the gross proceeds of any shares sold under the Sales Agreement.

The offering of common stock pursuant to the Sales Agreement will terminate upon the earlier of (i) the sale of common stock under the Sales Agreement having an aggregate gross sales price equal to $200 million and (ii) the termination of the Sales Agreement by us and the Sales Agent as permitted therein.

On February 27, 2023, we filed with the SEC a prospectus under the Registration Statement in connection with the ATM Offering (the ATM Prospectus), pursuant to which we may offer and sell shares of common stock having an aggregate offering price of up to $200 million.

As of September 30, 2024, there have been no sales pursuant to the ATM Prospectus.

In September 2024, we completed an underwritten public offering pursuant to the Shelf Registration Statement of 8,093,712 shares of common stock which included 1,458,600 shares issued pursuant to our underwriters’ exercise of their over-allotment option, as well as pre-funded warrants to purchase up to an aggregate of 3,088,888 shares of common stock.

We received net proceeds of $189.2 million after deducting underwriting discounts, commissions, and offering expenses

As of September 30, 2024, we had $754.7 million of cash, cash equivalents, restricted cash, and marketable debt securities compared to $697.4 million as of December 31, 2023.

As of June 30, 2024, we had $585.4 million of cash, cash equivalents, restricted cash, and marketable debt securities compared to $697.4 million as of December 31, 2023.

The investments in marketable debt securities are further described above in Note 6, Marketable Debt and Equity Securities , of Notes to Financial Statements included in this Form 10-Q/A.

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We have based these estimates on assumptions that may prove to be wrong which would cause us to use our capital resources sooner than we currently expect.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements.

Contractual Obligations and Commitments

There were no material changes outside of the ordinary course of business to our specific contractual obligations during the three months ended September 30, 2024.

There were no material changes outside of the ordinary course of business to our specific contractual obligations during the three months ended June 30, 2024.

Critical Accounting Policies

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q/A

Item 2. Management’s Discussion and Analysis