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Item 1. Business

2023-02-27 compared with 2022-02-24 · 193 added, 221 removed, 477 unchanged (46% of the section changed)

We are a clinical-stage biopharmaceutical company focused on discovering and developing engineered monoclonal antibody and cytokine therapeutics to treat patients with cancer and autoimmune diseases who have unmet medical needs.

We are advancing a broad portfolio of clinical-stage XmAb® drug candidates from our proprietary protein engineering technology platforms.

We also use our protein engineering capabilities to increase our understanding of protein structure and interactions and to design new technologies and XmAb development candidates with improved properties.

In addition to engineering protein-target interactions, our approach to protein design includes engineering Fc domains, the part of an antibody that interacts with multiple segments of the immune system and controls antibody structure.

We use our protein engineering capabilities to increase our understanding of protein structures and interactions and to design new technologies and XmAb® drug candidates with improved properties.

We advance these candidates into clinical-stage development, where we are conducting Phase 1 and Phase 2 studies for a broad portfolio of programs, to determine which programs we advance into later stages of development and potentially commercialization, which programs we partner to access complementary resources to optimize development, or which programs we terminate.

Our approach to protein design includes engineering Fc domains, the parts of antibodies that interact with multiple segments of the immune system and controls antibody structural architecture.

The Fc domain is constant and interchangeable among antibodies, and our engineered XmAb Fc domains can be readily substituted for natural Fc domains.

Our protein engineering capabilities and Fc technologies enable us and our partners to develop XmAb antibodies and biotherapeutic drug candidates with improved properties and functionality, which can provide innovative approaches to treating disease and potential clinical advantage over other treatment options.

For example, we have developed an antibody scaffold to rapidly create novel bispecific antibodies that bind two different targets simultaneously, creating entirely new biological mechanisms.

For example, we have developed an antibody scaffold to rapidly create novel multi-specific antibodies that bind two or more different targets simultaneously, creating entirely new biological mechanisms.

Other applications of our protein engineering technologies enhance antibody performance by increasing immune inhibitory activity, improving cytotoxicity, extending circulating half-life and stabilizing novel protein structures, such as engineered cytokines.

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• Create new technology platforms;

● Make new drug candidates for internal development or partnering opportunities;

• Engineer new drug candidates to advance into development or as partnering opportunities;

• Provide collaboration and licensing opportunities with partners for application of our technologies, access to our technologies, access to our drug candidates, or combinations of each.

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Advance the clinical development of our XmAb bispecific antibody and cytokine drug candidates.

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

We and our partners are enrolling patients in multiple mid-stage and early-stage clinical studies to evaluate our XmAb bispecific antibody drug candidates and engineered cytokine drug candidates.

We and our partners plan to advance additional bispecific antibodies and cytokines into clinical development in the future.

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

We and our partners are enrolling patients in multiple clinical studies to evaluate our candidates.

Build and manage a large and diversified portfolio of XmAb drug candidates.

We create new XmAb bispecific antibody and cytokine product candidates to exploit the novel mechanisms of action enabled by our protein engineering technology platforms, and we advance them into our portfolio of preclinical and clinical-stage assets.

We regularly evaluate our portfolio of candidates and make additional investments in those candidates that present promising early clinical and scientific data, partner certain drug candidates to third-party biotechnology and pharmaceutical companies, and will stop development of candidates based on the evaluation of emerging clinical and scientific data and the competitive environment for such programs.

We advance multiple candidates that we create from each of our XmAb technologies into early stages of development and evaluate data from such studies in managing our portfolio of candidates.

We make additional investments in those candidates that demonstrate encouraging early clinical and scientific data, partner certain drug candidates to third-party biotechnology and pharmaceutical companies, and stop development of candidates based on the evaluation of emerging clinical and scientific data and the competitive environment for such programs.

Leverage our protein engineering capabilities, XmAb Fc domains, and XmAb drug candidates with partnerships, collaborations, and licenses to generate revenue streams, create new drug candidates and combination treatments, and identify new indications for our pipeline of drug candidates.

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Generate revenue streams.

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We use the modularity of our XmAb bispecific Fc domains to engineer bispecific antibodies and cytokines in a variety of structural formats.

For example, CD3 bispecific antibodies of a mixed valency format, i.e., the XmAb 2+1 bispecific antibody, may preferentially kill tumor cells that have higher target expression than normal cells, which may be especially beneficial in designing antibodies that target solid tumors .

Additionally, we have engineered CD28 bispecific antibodies to provide conditional CD28 co-stimulation of T cells, activating them when bound to tumor cells.

Targeted CD28 bispecific antibodies may provide conditional co-stimulation of T cells, for example, to T cells recognizing neoantigens or in concert with CD3 T-cell engaging bispecific antibodies.

Continue to expand our patent portfolio protecting our Fc technologies and XmAb drug candidates.

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Our modular approach to protein engineering is a distinguishing feature of our Fc technologies.

This inherent flexibility enables us to design new XmAb bispecific antibody and cytokine drug candidates with distinct and novel mechanisms-of-action and to seek out new applications of the XmAb Bispecific Fc Domain.

This inherent flexibility enables us to design multiple XmAb bispecific antibody and cytokine drug candidates with distinct and novel mechanisms-of-action and to seek out new applications of the XmAb Bispecific Fc Domain.

Our business, research, and clinical efforts are to develop and advance our Fc technologies and our portfolio of XmAb bispecific antibody and engineered cytokine drug candidates in oncology and autoimmune diseases.

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CD3 bispecific antibody candidates are designed to redirect T cells to tumor cells through the engagement of an antigen on tumor cells and CD3, an activating receptor on T cells.

We are currently advancing two CD3 bispecific antibody candidates in Phase 2 clinical development:

plamotamab and tidutamab.

We have significantly expanded the potential of our CD3 bispecific antibodies with the multi-specific XmAb 2+1 bispecific antibody format, utilizing two identical tumor targeting domains and one CD3 targeting domain.

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In preclinical models, XmAb 2+1 bispecific antibodies bound preferentially to tumor cells compared to normal cells and effectively recruited T cells to kill tumor cells selectively.

believe that these properties will be particularly important when developing bispecific antibodies against many solid tumor targets, where standard monovalent targeting of tumor antigens could lead to poor tolerability because such targets are often expressed on a range of normal tissues, including critical organs.

We are currently initiating a Phase 1 study for XmAb819, an ENPP3 x CD3 bispecific antibody, which is engineered with the XmAb 2+1 bispecific antibody format.

We believe that these properties will be particularly important when developing bispecific antibodies against many solid tumor targets, where standard monovalent targeting of tumor antigens could lead to poor tolerability because such targets are often expressed on a range of normal tissues, including critical organs.

CD28 candidates:

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Targeted CD28 bispecific antibodies may provide conditional co-stimulation of T cells, for example, to T cells recognizing neoantigens or in concert with CD3 T-cell engaging bispecific antibodies.

We have engineered XmAb bispecific antibodies to provide selective CD28 co-stimulation of T cells, activating them when bound to tumor cells, and we are conducting preclinical studies of internal CD28 candidates.

Under our two collaborations with Janssen Biotech, Inc.

(Janssen), we are applying our bispecific technologies to create and characterize CD28 bispecific antibody candidates against a prostate tumor target, and against multiple B cell targets.

We have engineered XmAb bispecific antibodies to provide selective CD28 co-stimulation of T cells, activating them when bound to tumor cells.

TME activator candidates:

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These candidates also incorporate our Xtend™ technology for longer half-life.

We are currently advancing vudalimab in Phase 2 clinical development and are conducting Phase 1 studies for two additional TME activator candidates:

XmAb841 and XmAb104.

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Cytokine candidates:

We have also expanded the use of our XmAb bispecific Fc domain to engineer novel cytokine candidates, which are not antibodies, but fusions of a heterodimeric Fc domain and immune signaling proteins.

Our engineered novel cytokine candidates are fusions of XmAb Bispecific Fc Domains and immune signaling proteins.

We engineer our cytokine candidates with reduced potency to improve therapeutic index and with our Xtend technology for longer half-life.

Two XmAb cytokine candidates are being evaluated in Phase 1 studies:

XmAb306 (RO7310729) and XmAb564.

We continue to invest in our protein engineering efforts to identify novel technologies and drug candidates.

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We have also created additional XmAb Fc domains, and we have successfully entered partnerships for these technologies and for XmAb drug candidates that incorporate them.

We will continue to seek additional partnering and licensing opportunities for these Fc domains.

We continue to seek additional partnering and licensing opportunities for these Fc domains.

Additional XmAb Fc domains include:

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Vir Biotechnology, Inc.

and its partner GlaxoSmithKline Plc have made available sotrovimab, an antibody that targets the SARS-CoV-2 virus, which received an emergency use authorization (EUA) from the United States Food and Drug Administration (FDA) for the treatment of mild-to-moderate COVID-19 in high-risk adults and pediatric patients.

Sotrovimab has been granted a marketing authorization in the European Union (EU), approved via Japan’s Special Approval for Emergency Pathway in Japan, and granted conditional,

provisional, or temporary authorizations in 15 other countries.

and its partner GlaxoSmithKline Plc have made available sotrovimab, an antibody that targets the SARS-CoV-2 virus, and in 2021 they received an emergency use authorization (EUA) from the United States Food and Drug Administration (FDA) for the treatment of mild-to-moderate COVID-19 in high-risk adults and pediatric patients.

In the first quarter of 2022, the FDA deauthorized sotrovimab in treating patients with COVID-19.

Sotrovimab has been granted a marketing authorization in the European Union (EU), approved via Japan’s Special Approval for Emergency Pathway in Japan, and granted conditional, provisional, or temporary authorizations in more than 40 other countries.

GSK supplies sotrovimab under the name Xevudy .

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Alexion’s Ultomiris is approved in the U.S., Europe, and Japan for the treatment of patients with paroxysmal nocturnal hemoglobinuria (PNH) and for the treatment of patients with atypical hemolytic uremic syndrome (aHUS).

In April 2022, Ultomiris was approved by the FDA for the treatment of adult patients with generalized myasthenia gravis (bMG) who are anti-acetylcholine receptor (AChR) antibody positive.

Alexion is also evaluating Ultomiris in a broad late-stage development program across many indications in neurology and nephrology.

Alexion used our Xtend™ Fc Domain to enhance the half-life of Ultomiris to allow for a longer duration of action, less frequent dosing and reduced patient burden of therapy compared to the previous generation therapy, Soliris®.

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In 2020, the FDA approved Monjuvi under accelerated approval.

Monjuvi is a CD19-directed cytolytic antibody indicated in combination with lenalidomide for the treatment of adult patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) not otherwise specified, including DLBCL arising from low grade lymphoma, and who are not eligible for autologous stem cell transplant (ASCT).

Monjuvi is a humanized Fc-modified CD19 targeting immunotherapy indicated in combination with lenalidomide for the treatment of adult patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) not otherwise specified, including DLBCL arising from low grade lymphoma, and who are not eligible for autologous stem cell transplant (ASCT).

This indication is approved under accelerated approval based on overall response rate.

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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).

MorphoSys is also conducting studies of tafasitamab in additional B-cell indications.

MorphoSys and Incyte are also conducting studies of tafasitamab in additional B-cell indications.

Tafasitamab was created and initially developed by us.

Tafasitamab is co-marketed by Incyte and MorphoSys under the brand name Monjuvi in the U.S.

and is marketed by Incyte under the brand name Minjuvi in the EU.

and is marketed by Incyte under the brand name Minjuvi in Europe and Canada.

Incyte has exclusive commercialization rights to tafasitamab outside the U.S.

Monjuvi ® and Minjuvi ® are registered trademarks of MorphoSys AG.

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Drug Candidates in Clinical Development

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A partner is also advancing a drug candidate that incorporates our DN-TNF technology.

Co-developed with Partners

Developed by Partners

Marketed by Partners

XmAb306/RG6323

SARS-CoV-2 mAb Duo (BMS)

Wholly Owned Co-developed with Partners Developed by Partners Marketed by Partners

Vudalimab Plamotamab Obexelimab Ultomiris*

XmAb104 XmAb306/RG6323 VIR-3434 Monjuvi*

XmAb564 VIR-2482 Sotrovimab

XmAb819 AMG 509

XmAb808 ASP2138

Novartis bispecific antibody

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* Alexion and MorphoSys are conducting additional Phase 3 studies in new indications with these candidates.

We are also supporting investigator sponsored trials evaluating vibecotamab (CD123 x CD3) and XmAb968 (CD38 x CD3).

We regularly evaluate our portfolio of candidates and make additional investments in candidates with promising early-stage clinical data, partner out other candidates, and stop development of candidates where early clinical data does not support further investment.

● We initiated Phase 2 studies for our vudalimab and tidutamab programs,

● We licensed the worldwide rights to our plamotamab and obexelimab programs to strategic biopharmaceutical partners, and

● We stopped development of the vibecotamab program.

• We initiated a second Phase 2 study for our vudalimab program,

• We initiated Phase 1 studies for our XmAb819 and XmAb808 programs,

• We initiated a Phase1b study for our XmAb564 program, and

• We stopped development of the tidutamab and XmAb841 programs and also stopped development of our plamotamab, tafasitamab and lenalidomide combination study.

XmAb Bispecific Fc Drug Candidates in Clinical Development

Currently, 9 XmAb drug candidates that have been engineered with our XmAb bispecific Fc domain are in clinical development.

Currently, 10 XmAb drug candidates that have been engineered with our XmAb bispecific Fc domain are in active clinical development internally or with our partners.

• Five candidates are wholly owned and are being evaluated by us in Phase 2 or Phase 1 studies;

• Two candidates are being co-developed with partners;

● Two additional candidates are being advanced by our partners.

• Three additional candidates are being advanced by partners.

Additional candidates are advancing through the preclinical stages of development.

Drug candidates with our bispecific Fc domain, both bispecific antibodies and cytokines, in clinical development include:

Vudalimab (XmAb717) 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 other solid tumor types.

Xencor has initiated a Phase 2 clinical study of vudalimab in patients with mCRPC, as a monotherapy or in combination depending on molecular subtype, and a Phase 2 clinical study in patients with advanced gynecologic and genitourinary malignancies, as well as clinically defined high-risk mCRPC.

We presented updated data from the Phase 1 dose-escalation and expansion study at the Annual Meeting of the Society for Immunotherapy of Cancer (SITC) in November 2021.

110 patients had been treated at the 10 mg/kg recommended dose level in dose-escalation (n=7) and in five dose expansion cohorts:

melanoma (n=20), renal cell carcinoma (RCC, n=21), non-small cell lung cancer (NSCLC, n=20), CRPC (n=21) and other cancers without approved checkpoint therapies (n=21).

The safety analysis includes all 110 patients, who were a median of 65 years old and were heavily pretreated, having a median of four prior systemic therapies.

65% of patients had received at least one prior checkpoint therapy, and 25% had received at least two prior checkpoint therapies.

Vudalimab was generally well-tolerated, and the most common treatment-related adverse events were immune-related adverse events (irAEs).

The most common irAEs of any grade were rash (45.5%), pruritus (30.9%), transaminase increases (23.6%), diarrhea (11.8%), hypothyroidism (9.1%), infusion related reaction (8.2%) and myalgia (8.2%).

The efficacy analysis included 78 evaluable patients receiving any amount of vudalimab, who had been followed for at least two cycles.

Complete responses were observed in a patient with BRCA1+ high-grade serous ovarian cancer and in a patient with melanoma.

Partial responses were observed in patients with melanoma (n=2), RCC (n=3), NSCLC (n=2) and CRPC (n=2).

The objective response rate (ORR) across cohorts was 14.1% (11/78).

All responses in patients with melanoma and CRPC and two responses in patients with RCC were confirmed.

All responders, except those with CRPC, had received prior checkpoint inhibitor therapy.

The median duration of response, unadjusted, for all responders was 18.3 weeks.

The median duration of response, unadjusted, for patients with RCC was 24.1 weeks, and two patients remained on treatment.

Of the 12 efficacy-evaluable patients with CRPC, four had measurable disease and follow-up RECIST assessments, including the two CRPC responders.

Six additional patients with CRPC, but without measurable disease, experienced a best overall response of non-CR/non-PD, as stable disease cannot be determined without measurable disease.

The two CRPC responders had visceral and nodal metastases, had response durations of 41.3 and 27.0 weeks, were without progression on bone scans and had confirmed prostate-specific antigen (PSA) reductions of more than 50% from baseline.

Among twelve patients with baseline and follow-up PSA assessments, including the two responders, 33% (4/12) had PSA reductions greater than 50%.

Plamotamab is a bispecific antibody that targets CD20, an antigen on B-cell tumors, and CD3, an activating receptor on T cells.

In October 2021, we entered into a global collaboration and license agreement with Janssen to advance plamotamab and XmAb CD28 bispecific antibody combinations for the treatment of patients with B-cell malignancies, which expands our strategy to develop multiple highly active, chemotherapy-free regimens to treat patients with B-cell cancers.

Janssen received worldwide exclusive development and commercial rights

to plamotamab, and we will collaborate with Janssen on further clinical development of plamotamab, with us paying 20% of costs, including those for a subcutaneous formulation study anticipated to enter clinical trials in 2022.

We will continue, at our own expense, a Phase 1/2 combination study of plamotamab, tafasitamab (Monjuvi), and lenalidomide in patients with relapsed or refractory diffuse large B cell lymphoma (DLBCL), an aggressive type of non-Hodgkin lymphoma, and we plan to initiate the study in early 2022.

We presented updated data from Part B and Part C of a Phase 1 dose-escalation study at the American Society of Hematology Annual Meeting in December 2021.

Part B escalated dosing on administrations after the priming dose (doses between 80 and 360 mcg/kg).

Part C established a step-up dosing regimen with higher, flat and less frequent dosing.

The schedule, an intravenous, 50 mg flat dose every two weeks after step-up dosing during the first two cycles of treatment, was generally well tolerated and was determined to be the recommended Phase 2 dose.

The safety population included 50 patients in Part B (38 DLBCL, 12 FL) and 14 patients in Part C (8 DLBCL, 4 FL, 1 marginal zone lymphoma, 1 mantle cell lymphoma).

Patients were heavily pretreated.

The most common Grade 3 or 4 treatment-emergent adverse events (AEs) across all patients were anemia (21%), neutropenia (19%), hypophosphatemia (11%), thrombocytopenia (11%) and lymphopenia (10%).

Four patients (5%) experienced Grade 3 or 4 cytokine release syndrome (CRS), each instance on the first dose, and no patients experienced Grade 3 or 4 CRS in Part C of the study.

The rate of CRS of any grade fell from 74% in Part B to 57% in Part C.

CRS was generally manageable with premedication.

The efficacy analysis included 47 evaluable patients with either DLBCL or FL who were treated in Part B (n=38) or in Part C (n=9).

The ORR was 51% (24/47), and complete responses were observed in 12 patients (26%).

The median duration of response was 225 days for DLBCL and 171 days for FL, with six patients continuing to respond to plamotamab monotherapy.

In Part C, patients had generally more advanced disease and poorer responses to prior therapy.

Of the 14 patients in Part C, eight patients received prior CAR-T and three patients received NK cell therapy;

two of these patients received both.

All eight patients with DLBCL received prior CAR-T therapy.

In Part C, safety events were generally mild or moderate in severity.

Grade 3 or 4 AEs experienced by more than 5% of patients included anemia (14%), lymphopenia (14%) and one patient each (7%) experiencing neutropenia, thrombocytopenia, decreases in neutrophil count, transaminase increases, fatigue and gamma-glutamyl transferase increases.

The ORR was 100% (4/4) for FL, and CRs were observed in two patients (50%).

For DLBCL, the ORR was 40% (2/5), and a CR was observed in one patient (20%).

All 5 evaluable patients with DLBCL received prior CAR-T therapy, and two evaluable patients with DLBCL received prior NK cell therapy.

Expansion cohorts are actively recruiting patients with DLBCL and FL and are dosing using the recommended Phase 2 regimen to further evaluate the safety and efficacy of plamotamab monotherapy.

We plan to present data from these cohorts in the second half of 2022.

Tidutamab is a bispecific antibody that targets somatostatin receptor 2, or SSTR2, a target on many neuroendocrine-like tumor types, and CD3.

Dose-escalation and expansion data from the Phase 1 study in patients with neuroendocrine tumors (NET) indicates that tidutamab was generally well tolerated at the recommended dose identified for the expansion portion of the study.

Tidutamab induced sustained activation of cytotoxic T cells and engagement of the SSTR2 target and demonstrated an encouraging safety profile.

We are enrolling patients in a Phase 2 clinical study for tidutamab in patients with Merkel cell carcinoma and small cell lung cancer, which are SSTR2-expressing tumor types known to be responsive to immunotherapy.

XmAb306 (RO7310729) is an IL15/IL15-receptor alpha complex fused to our bispecific Fc domain (IL15/IL15Rα-Fc).

This cytokine was engineered for reduced potency, and the Fc domain incorporates our Xtend technology for extended half-life.

Xencor is co-developing the program in collaboration with Genentech, a member of the Roche Group.

Genentech is conducting a Phase 1 dose-escalation study of XmAb306 as a single agent and in combination with atezolizumab.

Additional studies of XmAb306 in combination with other agents are being planned.

In November 2021, we announced preliminary data from the Phase 1 study, while further dose escalation in both study arms continues.

At the time, the study had enrolled six cohorts in a monotherapy arm and four cohorts in an atezolizumab combination arm.

XmAb306 was generally well tolerated as both a monotherapy and in combination with atezolizumab.

No dose-limiting toxicities or treatment-related serious adverse events had been observed.

Assessments of pharmacokinetics indicated that XmAb306 has a multi-day circulating half-life, which is consistent with its reduced-potency design and data generated in preclinical studies.

Unconfirmed responses, as evaluated by RECIST criteria, had been observed in multiple tumor types, including in a patient treated with XmAb306 monotherapy.

The study had recently reached dose levels that promote T cell activity, and evidence of peripheral effector T cell proliferation had been observed.

Consistent and robust dose-dependent natural killer (NK) cell expansion and NK cell accumulation upon repeat dosing had been observed for multiple NK cell subsets, including mature NK cells.

Significant NK cell expansion and accumulation was observed beginning in lower dose cohorts, and at higher dosing cohorts NK cell expansion had reached 40- to 100-fold higher levels than baseline and had been sustained for weeks throughout dosing.

Wholly Owned Development Candidates

Vudalimab is a bispecific antibody that targets PD-1 and CTLA-4, two immune checkpoint receptors, and is designed to promote tumor-selective T-cell activation.

We are conducting a Phase 2 clinical study of vudalimab in patients with mCRPC, as a monotherapy or in combination depending on molecular subtype, and a Phase 2 clinical study in patients with advanced gynecologic malignancies and clinically defined high-risk mCRPC.

We continue to enroll patients into these clinical studies.

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XmAb104 is a bispecific antibody that targets PD-1 and ICOS, an immune co-stimulatory receptor, and is being developed in multiple oncology indications.

We are conducting an open-label, Phase 1, dose-escalation study to assess the safety, tolerability, and preliminary anti-tumor activity of XmAb104 in patients with selected solid tumors.

We are conducting a Phase 1 study to assess the safety, tolerability, and preliminary anti-tumor activity of XmAb104 in patients with selected solid tumors.

Initial data reported in 2022 indicated XmAb104 was well tolerated and exhibited a distinct safety profile compared to other clinical-stage ICOS programs.

We continue to enroll patients with select solid tumors in the dose expansion portion of the study, evaluating XmAb104 as a monotherapy and in combination with ipilimumab, an anti-CTLA4 antibody.

XmAb841 is a bispecific antibody that targets CTLA-4 and LAG-3, also an immune checkpoint receptor, and is being developed in multiple oncology indications.

We are advancing XmAb841 in combination with an anti-PD-1 drug to create a triple checkpoint blockade and conducting an open-label, Phase 1, dose-escalation study to assess the safety, tolerability, and preliminary anti-tumor activity of XmAb841 in patients with selected solid tumors.

We recently completed dose escalation in monotherapy and pembrolizumab combination cohorts and are enrolling in the expansion portion of the study.

XmAb564 is a monovalent, potency-reduced 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.

XmAb564 is engineered with reduced binding affinity for IL-2's beta receptor and increased binding affinity for its alpha receptor.

In preclinical studies, XmAb564 was well-tolerated, promoted the selective and sustained expansion of Tregs and exhibited a favorable pharmacokinetic profile.

We are conducting a randomized, double-blind, placebo-controlled Phase 1 clinical study to evaluate the safety and tolerability of a single dose of XmAb564, administered subcutaneously in healthy adult volunteers.

In a Phase 1a clinical study of XmAb564, a single dose of XmAb564, administered subcutaneously in healthy volunteers, was well tolerated and generated durable, dose-dependent and selective expansion of Tregs.

We are conducting a randomized, double-blind, placebo-controlled Phase 1b clinical study to evaluate the safety and tolerability of multiple ascending doses of XmAb564, administered subcutaneously in patients with atopic dermatitis or psoriasis.

XmAb819 is a first-in-class ENPP3 x CD3 XmAb 2+1 bispecific antibody that we are developing for patients with renal cell carcinoma (RCC).

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

We are conducting a Phase 1 study evaluating XmAb819 in patients with RCC.

XmAb808 is a tumor-selective, co-stimulatory XmAb 2+1 bispecific antibody 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, which was demonstrated in in vitro studies.

In vivo studies further demonstrated strong potentiation of checkpoint and CD3 cytotoxic activity.

Xencor is conducting a Phase 1 study of XmAb808 in combination with pembrolizumab in patients with advanced solid tumors.

Candidates Co-Developed with Partners

Plamotamab is a bispecific antibody that targets CD20, an antigen on B-cell tumors, and CD3, an activating receptor on T cells.

Janssen received worldwide exclusive development and commercial rights to plamotamab, and we are collaborating with Janssen on further clinical development of plamotamab, with us paying 20% of costs.

We are conducting a Phase 1 study of plamotamab in patients with non-Hodgkin's lymphomas, and we continue enrolling patients into subcutaneous dose escalation cohorts of this study.

XmAb306 (RO7310729) is a potency-reduced IL15/IL15-receptor alpha complex fused to our bispecific Fc domain (IL15/IL15Rα-Fc).

The Fc domain also incorporates our Xtend technology for extended half-life.

Xencor is co-developing the program in collaboration with Genentech, a member of the Roche Group.

Genentech is conducting a Phase 1 study of XmAb306 as a single agent and in combination with atezolizumab in patients with advanced solid tumors.

Genentech is also conducting two additional Phase 1 studies, evaluating XmAb306 in patients with relapsed/refractory multiple myeloma, either in combination with daratumumab (anti-CD38 antibody) or in combination with cevostamab (FcRH5 x CD3 bispecific antibody).

We continue to support enrollment into these clinical studies.

Candidates Advanced by Partners

AMG 509 is a STEAP1 x CD3 2+1 bispecific antibody that our partner Amgen is advancing for the treatment of patients with prostate cancer.

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In February 2022, Amgen presented encouraging, preliminary pharmacodynamic activity by induction of percent maximum PSA decline among 30 patients in the study, which provides an early signal of activity and validation of the potential of the XmAb 2+1 format.

XmAb819 is a first-in-class ENPP3 x CD3 XmAb 2+1 bispecific antibody that we are developing for patients with renal cell carcinoma (RCC).

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

We are initiating a Phase 1 study evaluating XmAb819 in patients with RCC.

ASP2138 is a Claudin-18.2 x CD3 2+1 bispecific antibody that our partner Astellas is advancing for the treatment of patients with gastric, gastroesophageal and pancreatic cancers and is currently being evaluated in a Phase 1 study.

The XmAb 2+1 multivalent format enables higher binding capability for Claudin-18.2 expressing cells.

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Novartis XmAb undisclosed bispecific antibody candidate.

in December 2019, Novartis initiated a Phase 1 clinical study with an undisclosed bispecific antibody candidate that was developed with our bispecific Fc technology under our collaboration with them.

Novartis is conducting a Phase 1 clinical study with an undisclosed bispecific antibody candidate that was developed with our bispecific Fc technology under our collaboration with them.

XmAb, Xtend, and Cytotoxic Fc Drug Candidates in Clinical Development

Currently, two drugs engineered with our Xtend Fc Domain and one drug we engineered with our XmAb Cytotoxic Fc Domain are marketed commercially by partners.

In addition to these approved drugs, our partners are advancing six clinical-stage programs with antibodies engineered with XmAb, Xtend, and/or Cytotoxic Fc Domains, including:

In addition to these approved drugs, our partners are advancing multiple clinical-stage programs with antibodies engineered with XmAb, Xtend, and/or Cytotoxic Fc Domains, including:

• Vir Biotechnology, Inc.:

Vir is advancing three candidates in clinical development.

Vir is advancing two candidates in clinical development.

VIR-3434 is being evaluated in a Phase 2 combination study as a potential treatment for patients with hepatitis B virus infection.

VIR-2482 is being evaluated in a Phase 2 study as a universal prophylactic for influenza A.

VIR-7832 is being evaluated in a Phase 1b/2a trial of adults with mild-to-moderate COVID-19;

● Bristol-Myers Squibb:

Bristol-Myers Squibb’s SARS-CoV-2 mAb Duo antibody combination therapy (BMS-986414 + BMS-986413) is being evaluated in the Phase 2/3 NIH ACTIV-2 trial in treating COVID-19 in outpatients;

• Gilead Sciences, Inc.:

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• Obexelimab targets CD19 with its variable domain and uses our XmAb Immune Inhibitor Fc Domain, which is designed to inhibit the function of B cells, an important component of the immune system.

In November 2021, we licensed this drug candidate to Zenas BioPharma, which is developing this candidate in autoimmune disease.

In November 2021, we licensed this drug candidate to Zenas BioPharma, which initiated a Phase 3 study with obexelimab in January 2023 in immunoglobulin G4-related disease (IgG4-RD).

• Xpro1595 is a proprietary TNF inhibitor candidate which we licensed to INmune Bio, Inc., in October 2017.

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• Technology Licensing Agreements:

Alexion Pharmaceuticals, Inc., Vir Biotechnology, Inc., Gilead Sciences, Inc., Bristol-Myers Squibb Company, Novartis AG, Omeros Corporation, Viridian Therapeutics, Inc., Astria Therapeutics, Inc.

Alexion Pharmaceuticals, Inc., Vir Biotechnology, Inc., Gilead Sciences, Inc., Novartis AG, Omeros Corporation, Viridian Therapeutics, Inc., Astria Therapeutics, Inc.

• Strategic Collaborations:

MorphoSys AG, Atreca, Inc., The University of Texas MD Anderson Cancer Center

Atreca, Inc., The University of Texas MD Anderson Cancer Center, Caris Life Sciences

Product Licenses

Product licenses are arrangements in which we license to third parties partial or full rights to develop and commercialize our internally developed drug candidates.

We seek partners that can provide infrastructure and resources to successfully develop our drug candidates, have a track record of successfully developing and commercializing medicines, or have a portfolio of development-stage candidates and commercialized medicines which could potentially be developed in rational combinations with our drug candidates.

We seek partners that can provide infrastructure and resources to

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successfully develop our drug candidates, have a track record of successfully developing and commercializing medicines, or have a portfolio of development-stage candidates and commercialized medicines which could potentially be developed in rational combinations with our drug candidates.

Janssen Biotech, Inc.

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We are collaborating with Janssen on further clinical development of plamotamab with Janssen paying 80% and the Company paying 20% of costs.

We are conducting, at our own expense, a clinical collaboration to evaluate the combination of plamotamab, tafasitamab, and lenalidomide in patients with B-cell lymphoma after which Janssen may opt into cost sharing to further develop the combination after establishing proof of concept.

We are generally responsible for conducting research activities, and Janssen is generally responsible for all development, manufacturing, and commercialization activities for CD28 bispecific antibodies that are advanced.

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We would then be eligible for low-double digit to mid-teen percent royalties on net sales of those products.

In January 2023, Janssen selected a CD28 candidate that we developed under the collaboration for further development.

In February 2019, we entered into an agreement with Genentech to develop and commercialize novel IL-15 cytokine therapeutics that use our bispecific Fc technology, including XmAb306, declared as a Collaboration Product under the agreement.

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In 2010, we licensed exclusive worldwide rights to develop and commercialize tafasitamab (formerly MOR208 and XmAb5574) to MorphoSys.

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Tafasitamab, which we engineered with an XmAb Cytotoxic Fc Domain, is the second XmAb medicine to be approved by the FDA.

In 2021, we earned $12.5 million in development milestones and royalties of $5.9 million on net sales.

In 2022, we earned royalties of $7.8 million on net sales.

We are also eligible to receive up to $85.5 million in additional milestones for development of tafasitamab in additional oncology indications and $50.0 million in sales milestones across all indications.

We are entitled to receive tiered royalties in the high-single digit to low-double digit percent range on net sales.

Tafasitamab is co-marketed by Incyte and MorphoSys under the brand name Monjuvi® in the U.S., and is marketed by Incyte under the brand name Minjuvi® in the EU.

Tafasitamab is co-marketed by Incyte and MorphoSys under the brand name Monjuvi® in the U.S., and is marketed by Incyte under the brand name Minjuvi® in Europe and Canada.

Incyte has exclusive commercialization rights to tafasitamab outside the U.S.

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In February 2020, we granted Aimmune Therapeutics, Inc., an exclusive worldwide license to develop and commercialize XmAb7195, which was renamed AIMab7195.

We received an upfront payment of $9.6 million in cash and shares of Aimmune common stock.

Aimmune was subsequently acquired by Nestlé S.A.

Nestlé is responsible for all further development and commercialization activities for AIMAb7195.

We are eligible to receive up to $385.0 million in milestones, which includes $22.0 million in development milestones, $53.0 million in regulatory milestones and $310.0 million in sales milestones, and tiered royalties in the high-single to mid-teen percent range on net sales of approved products.

Nestlé is planning additional studies of AIMab7195.

We received an upfront payment and we are eligible to receive development, regulatory and sales milestones and tiered royalties in the high-single to mid-teen percent range on net sales of approved products.

Nestlé is responsible for all further development of AIMab7195 and is planning additional studies of the candidate.

INmune Bio, Inc.

In October 2017, we entered into an agreement with INmune Bio, Inc., in which we provided INmune with an exclusive license to our Xpro1595 drug candidate.

In connection with the license, we received 1,585,000 shares of INmune common stock, an option to acquire up to 10% of the outstanding shares of INmune for $10.0 million, and an option to acquire 108,000 shares of common stock.

In 2021, we sold the option to acquire up to 10% of INmune, and we received $15.0 million in cash proceeds and an additional 192,533 share of INmune common stock.

We also exercised the option to acquire 108,000 shares of common stock for total proceeds of $0.8 million.

In October 2017, we entered into an agreement with INmune Bio, Inc., for an exclusive license to our Xpro1595 drug candidate.

In connection with the license, we received shares of INmune common stock, an option to acquire additional outstanding shares of INmune , and a second option to acquire additional shares of Inmune common stock.

In 2021, we sold the initial option to INmune, and we received $15.0 million in cash proceeds and additional shares of INmune common stock.

In 2021, we exercised the second option to acquire additional shares of common stock.

We are also eligible to receive a percentage of sublicensing revenue received for Xpro1595 and royalties in the mid-single digit percentage range on the sale of approved products.

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Zenas issued a warrant giving us the right to acquire additional Zenas equity, such that our total equity in Zenas would be 15% of its fully diluted capitalization following the closing of Zenas’ next round of equity financing, subject to certain requirements.

We are also eligible to receive up to $470.0 million based on the achievement of certain clinical development, regulatory and commercialization milestones and are eligible to receive tiered, mid-single digit to mid-teen percent royalties upon commercialization of obexelimab, dependent on geography.

In 2022, Zenas completed a financing transaction, and we received additional shares in Zenas in exchange for the warrant such that our total ownership is equal to 15% of the fully diluted outstanding shares of Zenas.

We are eligible to receive up to $470.0 million based on the achievement of certain clinical development, regulatory and commercialization milestones and are eligible to receive tiered, mid-single digit to mid-teen percent royalties upon commercialization of obexelimab, dependent on geography.

Zenas will have sole responsibility for advancing the research, development, regulatory and commercial activities of obexelimab worldwide.

In January 2023, Zenas initiated a Phase 3 study of obexelimab.

Novel Bispecific Antibody Collaborations

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Our partners provide an antibody or an antigen against tumors, and we conduct limited research and development activities to create potential bispecific antibody candidates for further development and commercialization by our partners.

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Janssen Biotech, Inc.

In November 2020, we entered into an agreement, which became effective in December 2020, with Janssen Biotech, Inc.

In November 2020, we entered into an agreement, with Janssen Biotech, Inc.

(Janssen), to develop XmAb bispecific antibodies against CD28 and an undisclosed prostate tumor target, for the potential treatment of patients with prostate cancer.

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Preclinical activities and all clinical development, regulatory and commercial activities will be conducted by Janssen, which has exclusive worldwide rights to develop and commercialize the novel drug candidates developed in the collaboration.

We received a $50.0 million upfront payment and are eligible to receive a total of $662.5 million in milestone payments which include $161.9 million in development milestones, $240.6 million in regulatory milestones, and $260.0 million in sales milestones.

We are also eligible to receive tiered royalties in the high-single to low-double digit percentage range on net sales.

We received a $50.0 million upfront payment and are eligible to receive development, regulatory and sales milestones, and we are also eligible to receive tiered royalties in the high-single to low-double digit percentage range on net sales.

Upon development of a bispecific candidate by Janssen through proof of concept, the agreement provides us the right to opt-in to fund 20% of development costs and to perform up to 30% of detailing efforts in the U.S.

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Both we and Janssen also have the right to access predefined agents from each other’s portfolios to evaluate potential combination therapies in prostate cancer, subject to certain limitations.

In 2021, we received a $5.0 million milestone payment related to Janssen selecting a candidate for further development, and we are eligible to receive an additional $156.9 million in development milestones as the program advances.

In 2021, Janssen selected a candidate developed under the agreement for further development and we received a milestone payment, and we are eligible to receive an additional $156.9 million in development milestones as the program advances.

Astellas Pharma, Inc.

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Astellas was granted a worldwide exclusive license, with the right to sublicense products in the field created by the research activities.

Astellas has selected a bispecific antibody developed under the

collaboration, ASP2138, a CLDN18.2 x CD3 bispecific antibody, for further development to treat patients with gastric, gastroesophageal, and pancreatic cancers.

We received an upfront payment of $15.0 million, and we are eligible to receive up to $240.0 million in milestones which include $32.5 million in development milestones, $57.5 million in regulatory milestones and $150.0 million in sales milestones and royalties on net sales in the high-single to low-double digit percentage range.

In 2020, we received a $2.5 million milestone payment related to Astellas advancing a bispecific candidate into IND enabling studies, and we are eligible to receive an additional $30.0 million in development milestones as the program advances.

Astellas has selected a bispecific antibody developed under the collaboration, ASP2138, a CLDN18.2 x CD3 XmAb 2+1 bispecific antibody, for further development to treat patients with gastric, gastroesophageal, and pancreatic cancers.

We received an upfront payment and we are eligible to receive development, regulatory and sales milestones and royalties on net sales in the high-single to low-double digit percentage range.

In 2022, we received a $5.0 million milestone payment related to Astellas advancing the ASP2138 candidate into Phase 1 studies, and we are eligible to receive an additional $25.0 million in development milestones as the program advances.

In September 2015, we entered into an agreement with Amgen Inc.

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We have received a total of $60.5 million in upfront and milestone payments and are eligible to receive up to $255.0 million in future development, regulatory and sales milestone payments in total for AMG 509 and royalties on net sales.

In connection with our June 2016 agreement with Novartis, we also applied our XmAb bispecific Fc technology to two target pair antibodies selected by Novartis.

Novartis is responsible for development and commercialization of these programs.

We are eligible to receive up to $250.0 million in milestone payments for each program which includes $50.0 million in development milestones, $100.0 million in regulatory milestones, and $100.0 million in sales milestones and royalties in the mid-single digit percent range on net sales of approved products.

Novartis is conducting a Phase 1 study of an undisclosed bispecific antibody candidate and we received a $10.0 million milestone payment for this program in 2020.

In connection with our June 2016 agreement with Novartis, we applied our XmAb bispecific Fc technology to a target pair antibody selected by Novartis.

Novartis is responsible for development and commercialization of the program.

We are eligible to receive development, regulatory and sales milestone payments and royalties in the mid-single digit percent range on net sales of approved products.

Novartis is conducting a Phase 1 study of an undisclosed bispecific antibody candidate.

Technology Licensing Agreements

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Our partners are responsible for all research, development and commercialization activities of the drug candidates.

The plug-and-play nature of XmAb Fc domains allows us to license access to our platforms with no internal research and development activities required of us.

The plug-and-play

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nature of XmAb Fc domains allows us to license access to our platforms with no internal research and development activities required of us.

Alexion Pharmaceuticals, Inc.

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Sotrovimab, an antibody that targets the SARS-CoV-2 virus, has received an emergency use authorization from the FDA and temporary authorizations in multiple global markets for the treatment of mild-to-moderate COVID-19 in high-risk adults and pediatric patients.

In addition, Vir is evaluating VIR-7832 in a Phase 1b/2a trial of adults with mild-

to-moderate COVID-19.

In March 2020, we entered into an agreement in which we provided Vir a non-exclusive license to our Xtend technology to extend the half-life of novel antibodies, including sotrovimab, that Vir is investigating as potential treatments for patients with COVID-19.

Vir is responsible for all research, development, regulatory and commercial activities for COVID-19 antibodies, and we are eligible to receive royalties on the net sales of approved products in the mid-single digit percentage range.

During 2021, we recorded estimated royalty revenue of $52.2 million.

Vir, along with alliance partner GlaxoSmithKline Plc, is responsible for all research, development, regulatory and commercial activities for COVID-19 antibodies, and we are eligible to receive royalties on the net sales of approved products in the mid-single digit percentage range.

During 2022, we recorded royalty revenue of $114.9 million.

In August 2019, we entered into an agreement with Vir Biotechnology, Inc., in which we provided Vir a non-exclusive license to our Xtend technology for two targets in infectious disease.

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We are also eligible to receive royalties in the low-single digit percentage range on net sales of approved products.

Bristol-Myers Squibb Company

In May 2021, we entered into an agreement with Bristol-Myers Squibb Company (BMS), in which we provided BMS a non-exclusive license to our Xtend Fc technology to extend the half-life of antibodies that specifically bind to SARS-CoV-2.

BMS is responsible for all research, development, regulatory and commercial activities.

We are eligible to receive royalties on net sales of approved products in the low-single digit percentage range.

BMS is evaluating the SARS-CoV-2 mAb Duo antibody combination therapy (BMS-986414 + BMS-986413) in the Phase 2/3 NIH ACTIV-2 trial in treating COVID-19 in outpatients.

Omeros Corporation

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OMS906, a MASP-3 targeted antibody, is being evaluated in a Phase 1 study in patients with PNH and other alternative pathway disorders.

We received an upfront payment of $5.0 million, and for each product incorporating our Xtend Fc technology, we are eligible to receive up to $65.0 million in milestones, which includes $15.0 million in development milestones, $25.0 million in regulatory milestones and $25.0 million in sales milestones.

We are also eligible to receive royalties in the mid-single digit percentage range on net sales of approved products.

We received an upfront payment and we are eligible to receive development, regulatory and sales milestones and we are also eligible to receive royalties in the mid-single digit percentage range on net sales of approved products.

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Viridian Therapeutics, Inc.

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Viridian is responsible for all development and commercialization activities.

We received an upfront payment of 322,407 shares of Viridian common stock valued at $6.0 million and are eligible to receive up to $55.0 million in milestones, which include $10.0 million in development milestones, $20.0 million in regulatory milestones and $25.0 million in sales milestones.

We are also eligible to receive royalties in the mid-single digit percentage range on net sales of approved products.

We received shares of Viridian common stock valued at $6.0 million as an upfront payment and are eligible to receive development, regulatory and sales milestones and we are also eligible to receive royalties in the mid-single digit percentage range on net sales of approved products.

In December 2021, we entered into a second agreement with Viridian for a non-exclusive license to certain antibody libraries developed by us.

Under the agreement, Viridian received a one-year research license to review the antibodies and the right to select up to three antibodies for further development.

Under the agreement, Viridian received a research license to review the antibodies and the right to select a limited number of antibodies for further development.

Viridian is responsible for all further development of the selected antibodies.

We received an upfront payment of 394,737 shares of Viridian common stock valued at $7.5 million and are eligible to receive development, regulatory and sales milestones in addition to royalties on net sales of approved products under the agreement.

We received Viridian common stock valued at $7.5 million as an upfront payment and are eligible to receive development, regulatory and sales milestones in addition to royalties on net sales of approved products under the agreement.

Astria Therapeutics, Inc/Catabasis Pharmaceuticals, Inc./Quellis Biosciences, Inc.

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Catabasis subsequently changed its name to Astria Therapeutics, Inc.

We are eligible to receive up to $66.0 million in milestones, which include $6.0 million in development milestones, $30.0 million in regulatory milestones and $30.0 million in sales milestones.

We are also eligible to receive royalties in the mid-single digit percentage range on net sales of approved products.

In addition to equity shares in Astria, we are eligible to receive development, regulatory and sales milestones and we are also eligible to receive royalties in the mid-single digit percentage range on net sales of approved products.

Strategic Collaborations

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Through these arrangements we seek to create new drug candidates, investigate novel combination therapies and potentially identify additional indications for our portfolio of XmAb drug candidates.

In November 2020, we entered into a strategic collaboration with MorphoSys AG and Incyte to conduct clinical studies to investigate the chemo-therapy free combination of plamotamab and tafasitamab in combination with lenalidomide in patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL), first-line DLBCL, and relapsed or refractory follicular lymphoma (FL).

MorphoSys and Incyte Corporation will provide tafasitamab for the studies, which Xencor will sponsor and fund.

In July 2020, we entered into an agreement with Atreca, Inc., to research, develop and commercialize novel CD3 bispecific antibodies as potential therapeutics in oncology.

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In addition, each partner has the option to pursue up to two programs independently, with a royalty in the mid- to high-single digit percentage range payable on net sales to the other partner.

In January 2023, we and Atreca selected a candidate to be developed under the collaboration.

The University of Texas MD Anderson Cancer Center

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In December 2021, we extended the agreement for an additional year at the same level of committed funding.

MD Andersen is conducting clinical studies with our vudalimab candidate.

In December 2020, we entered into a second agreement with MD Anderson to develop novel CD3 bispecific antibody therapeutics for the potential treatment of patients with cancer.

MD Anderson will work to identify and develop potential antibodies, and we will apply its our Fc bispecific technology to create therapeutic candidates.

MD Anderson will work to identify and develop potential antibodies, and we will apply our Fc bispecific technology to create therapeutic candidates.

MD Anderson will then conduct and fund all preclinical activities to advance candidates toward clinical studies.

We have certain exclusive options to license worldwide rights to develop and commercialize potential new medicines arising from the collaboration.

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Caris Life Sciences

In July 2022, we entered into an agreement with Caris Life Sciences (Caris), under which Caris will apply its proprietary end-to-end discover platform to identify novel targets for XmAb bispecific antibody drug candidates for the treatment of patients with cancer.

We received exclusive options to research, develop and commercialize products directed up to three targets.

Caris received an upfront payment and will be eligible to receive licensing fees, discovery, development, regulatory and sales-based milestones and royalty payments on net sales of each product commercialized by us and future rights for molecular profiling and companion diagnostics for drug candidates developed under the collaboration.

In December 2022, we expanded our Caris collaboration with a second agreement.

The second agreement increased the number of targets that Caris will provide and also the tumor types that are being investigated.

We paid Caris an upfront payment and Caris is eligible for additional licensing fees, milestones and royalty payments on net sales of each product commercialized by us.

Our Research and Development Pipeline

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We seek and support a diverse population of employees without regard to race, gender or sexual orientation.

As of December 31, 2021, we had 254 full-time employees, representing a 26% increase in our employee workforce as compared to December 31, 2020.

As of December 31, 2022, we had 281 full-time employees, representing an 11% increase in our employee workforce as compared to December 31, 2021.

Of these, 233 were engaged in research and development activities, and 48 were engaged in business development, information systems, facilities, human resources, or administrative support.

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We continue practices that address the COVID-19 pandemic consistent with government guidelines to mitigate and prevent the spread of disease, such as masking, social distancing, contact tracing, and encouraging vaccinations.

In 2021, in connection with the ongoing pandemic we continued the following practices:

In 2022, in connection with the ongoing pandemic we adopted the following practices:

• Provided a remote or hybrid work option for all non-laboratory staff with technical support, training, and equipment to enable employees to continue to perform their responsibilities while working remotely;

● Conducted safety procedures for all onsite staff which includes mandatory weekly onsite SARS-CoV-2 virus testing for all employees and their household members, reimbursement of 100% of medical insurance costs for onsite employees, and fully paid time off for any employee that missed time due to the COVID-19 virus including for the care of family members.

• Conducted safety procedures for all onsite staff which included offering weekly onsite SARS-CoV-2 virus testing for all employees and their household members and providing paid time off for any employee that missed time due to the COVID-19 virus including for the care of family members.

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Compensation, Benefits, and Development

We provide compensation packages designed to attract, retain, and motivate high-quality employees, and all of our employees are eligible for cash bonuses and grants of equity awards.

We regularly evaluate our compensation programs with an independent compensation consultant and utilize industry benchmarking in an effort to ensure they are

competitive compared to similar biotechnology and biopharmaceutical companies with which we compete for talent and that they are fair and equitable across our workforce with respect to gender, race, and other personal characteristics.

We provide compensation packages designed to attract, retain, and motivate high-quality employees.

All of our employees are eligible for cash bonuses and grants of equity awards.

We regularly evaluate our compensation programs with an independent compensation consultant and utilize industry benchmarking in an effort to ensure they are competitive compared to similar biotechnology and biopharmaceutical companies with which we compete for talent and that they are fair and equitable across our workforce with respect to gender, race, and other personal characteristics.

All employees are eligible to participate in the Employee Stock Purchase Plan where they can purchase shares of Xencor common stock at a discounted price.

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Market Opportunity

Our drug candidates that use the XmAb bispecific Fc domain, including plamotamab, vudalimab , tidutamab, XmAb841, XmAb104, XmAb306, and XmAb564 :

We are developing our bispecific antibody and cytokine candidates to treat cancer.

Our drug candidates that use the XmAb bispecific Fc domain, including plamotamab, vudalimab, XmAb104, XmAb306, XmAb819, XmAb808, and XmAb564 :

We are developing our bispecific antibody and cytokine candidates to treat cancer and autoimmune diseases.

Cancer is a broad group of diseases in which cells divide and grow in an uncontrolled fashion, forming malignancies that can invade other parts of the body, and it is the second leading cause of death in the United States (U.S.).

The American Cancer Society estimates that in 2023 there will be approximately 2.0 million new cases of cancer and approximately 609,820 deaths from cancer.

The National Institutes of Health (NIH) estimated that based on growth and aging of the U.S.

The National Institutes of Health (NIH) has estimated that based on growth and aging of the U.S.

population, medical expenditures for cancer in the year 2030 are projected to reach at least $245.6 billion.

We are evaluating XmAb564 as a potential treatment for patients with autoimmune diseases.

The autoimmune disease therapeutic market generally presents an opportunity in various small and large market indications, some of which may be appropriate for XmAb564.

Autoimmune diseases represent the third most common cause of chronic illnesses in the United States.

The National Institutes for Health (NIH) estimates that they collectively affect between 5% and 8% of the US population and currently more than 50 million Americans have one or more autoimmune diseases.

Globally, the autoimmune disease therapeutics market was estimated to be $92 billion in 2022 (GlobalData).

Intellectual Property

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We also have a large number of issued patents and pending patent applications with claims directed specifically to our XmAb technology and candidates.

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The patent expiration in the U.S.

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We have pending applications filed that may extend the exclusivity of some of our technology and products:

Patent Expiry

Immune Inhibitor

CD3 T Cell Engagers

CD28 T Cell Engagers

Company Products

Patent Expiry

Vudalimab, XmAb841, XmAb104

Partnered Products

Patent Expiry

Monjuvi (tafasitamab)

AIMab7195 (XmAb7195)

Obexelimab (XmAb5871)

Technology Patent Expiry

Cytotoxic 2025 U.S.;

Immune Inhibitor 2028 U.S.;

Xtend 2025 U.S.;

Bispecific 2034 U.S.

CD3 T Cell Engagers 2035 U.S.

CD28 T Cell Engagers 2041 U.S.

Company Products Patent Expiry

XmAb808 2041 U.S, and Ex-U.S.

Vudalimab, XmAb104 2037 U.S.

XmAb564 2038 U.S.

XmAb819 2040 U.S.

XmAb306 2038 U.S.;

Partnered Products Patent Expiry

Monjuvi (tafasitamab) 2029 U.S.;

Ultomiris 2025 U.S.;

AIMab7195 (XmAb7195) 2029 U.S.

Sotrovimab 2025 U.S.;

Obexelimab (XmAb5871) 2029 U.S.;

Plamotamab 2035 U.S.

The Hatch-Waxman Act permits a patent term extension for FDA-approved drugs, including biological products, of up to five years beyond the expiration of the patent.

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In many cases, this allows biosimilars to be brought to market without conducting the full suite of clinical trials typically required of originators.

Under the ACA, a manufacturer may submit an application for licensure of a biologic product that is "biosimilar to"

or "interchangeable with"

a previously approved biological product or "reference product."

The "biosimilar"

application must include specific information demonstrating bio similarity based on data derived from:

Under the ACA, a manufacturer may submit an application for licensure of a biologic product that is "biosimilar to" or "interchangeable with" a previously approved biological product or "reference product." The "biosimilar" application must include specific information demonstrating bio similarity based on data derived from:

(1) analytical studies, (2) animal studies, and (3) a clinical study or studies that are sufficient to demonstrate safety, purity, and potency in one or more appropriate conditions of use for which the reference product is licensed, except that FDA may waive some of these requirements for a given application.

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There have been recent proposals to repeal or modify the ACA, and it is uncertain how any of those proposals, if approved, would affect these provisions.

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In addition to patent protection, we rely on trade secret protection and know-how to expand our proprietary position around our technology and other discoveries and inventions that we consider important to our business.

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We have obtained registrations for the Xencor trademark, as well as certain other trademarks, which we use in connection with our pharmaceutical research and development services and our clinical-stage products, including XmAb.

We currently have registrations for Xencor and PDA in the United States, Australia, Canada, the European Community, and Japan, for Protein Design Automation in the United States, Australia, Canada, and the European Community, and for XmAb in the United States, Australia, Canada, the European Community and Japan.

We currently have registrations for Xencor and XmAb in the United States, Australia, Canada, the European Union, the United Kingdom, and Japan, and for Proteins by Design in the United States, Australia, Canada, and the European Union and the United Kingdom.

Third Party Vendors and Suppliers

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We have used third party manufacturers for all our bispecific antibody and cytokine candidates which include:

plamotamab, tidutamab, vudalimab, XmAb841, XmAb104, XmAb306, XmAb564, and XmAb819.

plamotamab, vudalimab, XmAb104, XmAb306, XmAb564, XmAb819 and, XmAb808.

Additional contract manufacturers are used to fill, label, package and distribute investigational drug products.

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We have engaged KBI under the KBI Agreement for process development, clinical scale-up, analytical method development, formulation development, and other services related to drug substance and drug product for our bispecific antibody and cytokine development candidates:

plamotamab, tidutamab, vudalimab, XmAb841, XmAb104, XmAb306, and XmAb564 in accordance with cGMP regulations.

plamotamab, vudalimab, XmAb104, XmAb306, and XmAb564 in accordance with cGMP regulations.

For each bispecific program, we have entered into a separate agreement with the terms and conditions of services and payment.

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Selexis has manufactured cell lines for certain of our bispecific antibody and cytokine drug candidates, and we currently have rights to obtain commercial licenses to the Selexis cell line for the following bispecific antibody and cytokine candidates:

plamotamab, tidutamab, vudalimab, XmAb841, XmAb104, XmAb306, XmAb564, and XmAb819.

License Agreements with BIO-TECHNE

In February 2015, we entered into a license agreement with BIO-TECHNE Corporation (BIO-TECHNE) for a non-exclusive license to certain antibody technology including monoclonal antibodies which recognize human somatostatin receptor 2 (SSTR2).

The variable domain of this antibody is incorporated in our tidutamab drug candidate.

Under the terms of this agreement, we made an upfront payment and are obligated to make payments upon the achievement of certain development and regulatory milestones, and royalties based on a percentage of net sales from products that are derived from the tidutamab program.

The royalty is less than 1%.

We entered into a second agreement with BIO-TECHNE effective February 2018 for a non-exclusive license to a certain recombinant monoclonal antibody reactive with human programmed death protein, PD-1.

plamotamab, vudalimab, XmAb104, XmAb306, XmAb564, and XmAb819.

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License Agreement with BIO-TECHNE

In February 2018, we entered into an agreement with BIO-TECHNE for a non-exclusive license to a certain recombinant monoclonal antibody reactive with human programmed death protein, PD-1.

We expect to use this protein in certain of our oncology drug candidates.

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Patheon has the unilateral right to terminate the Patheon Agreement if we request to reschedule work beyond 120 days, the project work is not progressing according to our expectations and we cannot agree on appropriate changes, after six months of inactivity on a project at our request or if Patheon determines it is unable to perform its obligations in a safe and effective way in compliance with applicable regulatory requirements.

Patheon is currently conducting process transfer, process development and cGMP manufacturing for our XmAb819 program.

Patheon is currently manufacturing drug substance material for our XmAb819 program.

Master Services Agreement with WuXi Biologics (Hong Kong) Limited

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WuXi has the unilateral right to terminate the WuXi Agreement only if the services cannot be performed due to technical difficulties or the performance of the services is not permitted under applicable law.

WuXi is currently conducting process transfer, process development and cGMP manufacturing for our XmAb808 (B7-H3 x CD28) and our IL-12 programs.

WuXi is currently manufacturing drug substance and drug product for XmAb808 and XmAb662.

Master Clinical Services Agreement with ICON Clinical Research Limited

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We may unilaterally terminate any project under the ICON Agreement upon 30 days’ prior written notice to ICON for any reason, subject to applicable termination fees.

ICON is currently providing services to us in connection with each ongoing Xencor-sponsored clinical trial.

ICON is currently providing services to us in connection with ongoing Xencor-sponsored clinical trial that target oncology indications.

Master Services Agreement with Innovaderm Research, Inc.

In April 2022, we entered into a Master Services Agreement (Innovadrem Agreement) with Innovaderm Research, Inc.

(Innovaderm).

Under the terms of the Innovaderm Agreement, Innovaderm will perform clinical trial management and clinical development services (including site selection, study design, site monitoring, management and training, and patient

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selection) for Xencor in accordance with applicable regulations.

The Innovaderm Agreement may be terminated by either party for a breach upon fifteen (15) day written notice, if such breach is not cured within thirty (30) days.

We may terminate the Innovaderm Agreement upon thirty (30) days written notice to Innovaderm for any reason, however, we will be obligated for any costs incurred through the cancellation date and any non-refundable and non-cancellable commitments incurred by Innovaderm.

Innovaderm is currently conducting clinical studies for our XmAb564 program.

We compete in an industry that is characterized by rapidly advancing technologies, intense competition, and a strong emphasis on proprietary products.

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We are developing bispecific antibody drug candidates engineered to direct cytotoxic T cell killing of tumor cells, by engaging the CD3 receptor on T cells and an antigen on tumor cells.

Regarding plamotamab, other companies developing CD3 bispecific antibodies directed to CD20, an antigen expressed on many blood tumors, include AbbVie Inc.

and Genmab A/S;

Other companies conducting clinical trials to evaluate CD3 bispecific antibodies directed to antigens expressed on tumors include AbbVie Inc.;

IGM Biosciences, Inc.;

Johnson & Johnson;

Pfizer, Inc.;

Regeneron Pharmaceuticals, Inc.;

and Roche Holding AG.

Other antibodies, antibody drug candidates and cell therapies are in development or approved to treat patients with non-Hodgkin lymphomas.

We are also developing several bispecific antibody drug candidates engineered to selectively engage the immune system in order to treat patients with cancer, such as vudalimab, XmAb841 and XmAb104.

Other antibodies, antibody drug candidates and cell therapies are in development or approved to treat patients with cancer.

We are also developing several bispecific antibody drug candidates engineered to selectively engage the immune system in order to treat patients with cancer.

Immuno-oncology is a competitive field within the biotechnology and pharmaceutical industries, and most large pharmaceutical companies are developing drug candidates, have marketed medicines in this space, or both:

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Several companies are developing engineered cytokines intended to activate specific immune cell populations in order to treat patients with cancer and/or autoimmune diseases, including Alkermes plc;

Asher Biotherapeutics, Inc.;

Cue Biopharma, Inc.;

Cytune Pharma;

Eli Lilly and Company;

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Roche Holding AG;

Sotio Biotech;

Sutro Biopharma, Inc.;

Synthekine, Inc.;

and Xilio Therapeutics, Inc.

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We anticipate that we will face intense and increasing competition as new treatments enter the market and advanced technologies become available.

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Regulatory Overview

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FDA review and approval of the BLA prior to any commercial marketing or sale.

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Before testing any compounds with potential therapeutic value in humans, the product candidate enters the preclinical testing stage.

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The FDA may, on its own initiative or at the request of the applicant, grant deferrals for submission of some or all pediatric data until after approval of the product for use in adults, or full or partial waivers from the pediatric data requirements.

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The FDA will issue a complete response letter describing deficiencies in the BLA and recommend actions if the agency decides not to approve the BLA.

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Depending upon the timing, duration and specifics of the FDA approval of any of our biologic product candidates, we may apply for limited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, commonly referred to as the Hatch-Waxman Amendments.

The Hatch-Waxman Amendments permit a patent restoration term of up to five years for one patent per product as compensation for patent term lost during

product development and the FDA regulatory review process of that product.

The Hatch-Waxman Amendments permit a patent restoration term of up to five years for one patent per product as compensation for patent term lost during product development and the FDA regulatory review process of that product.

Patent and Trademark Office, in consultation with the FDA, reviews and approves the application for any patent term extension or restoration.

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In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative initiatives.

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Other Healthcare Laws and Compliance Requirements

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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-K

Item 1. Business