Xoma Royalty Corporation · NASDAQ:XOMA
Xoma Royalty — XOMA — Investor Presentation (March 2019)
27 slides from Xoma Royalty's investor presentation, Mar 11, 2019
Slide 1: Corporate Presentation March 2019: A Royalty Aggregation Company
CORPORATE PRESENTATION March 2019 NASDAQ: XOMA A Royalty Aggregation Company Exhibit 99.1
Slide 2: Disclaimers
DISCLAIMERS Certain statements in this presentation are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements regarding: future potential monetization opportunities, active transactions
Slide 3: XOMA Snapshot
Monetizing and aggregating pre-commercial drug royalties Use portfolio approach to expand number of royalty positions Differentiate by focusing on development-stage assets with blockbuster potential licensed to large-cap partners Providing exposure, through royalties, to the upside potential of biot
Slide 4: XOMA's Portfolio Model
XOMA’s Approach Accumulate and hold milestone and royalty interests in multiple assets partnered with pharmaceutical companies who conduct and fund R&D. XOMA’S PORTFOLIO MODEL Traditional Biotech Companies Fund and perform internal research and development; expensive and can take up to 15 years. Man
Slide 5: XOMA vs. Traditional Biotech Industry
XOMA vs. Traditional Biotech Industry Biotech Industry Characteristics Hold royalty interests for the long-term Development costs borne by partners Large diversified portfolio mitigates single asset risk XOMA Royalty Aggregator Strategy LONG PRODUCT LIFE CYCLES HIGH CAPITAL REQUIREMENTS LOW SUCCESS
Slide 6: Opportunities Abound for Royalty Monetization
PHASE 3 LICENSING DEALS: 236 TOTAL LICENSING DEALS 2014 - 2018 1,988 Opportunities Abound for Royalty Monetization PHASE 2 LICENSING DEALS: 343 PHASE 1 LICENSING DEALS: 194 PRECLINICAL / OTHER LICENSING DEALS: 1,215 Biotech & Pharma License Transactions consist of: Milestone payments Royalty obligat
Slide 7: XOMA Positioned to Monetize Royalties on Mid-to-Early Stage Clinical Assets
PRECLINICAL PHASE 1 PHASE 2 PHASE 3 APPROVAL COMMERCIAL > $100M $25M – $100M < $25M Capital Deployed per Transaction Ligand Royalty Pharma HCRP XOMA IS POSITIONED TO MONETIZE ROYALTIES ON MID-TO EARLY STAGE CLINICAL ASSETS
Slide 8: XOMA's Competitive Advantage
XOMA’S COMPETITIVE ADVANTAGE Typical Small/ Mid-Cap Biotech PORTFOLIO SIZE 1 - 3 assets 45 assets PORTFOLIO FOCUS Narrow Diversified PROBABILITY OF AN APPROVAL Low High RISK : RETURN POTENTIAL High : High Low : Mid / High CAPITAL User Provider
Slide 9: Measuring XOMA's Intrinsic Value Today
MEASURING XOMA’S INTRINSIC VALUE TODAY XOMA portfolio profile 45 assets and growing > 60% of assets in mid-stage development Many with blockbuster revenue potential Typical XOMA economics Development & Sales milestones Royalty rate: ~3% Royalty term: 8 – 12 years post commercialization
Slide 10: XOMA's Model: Hold & Buy More
26 XOMA’S MODEL: HOLD & BUY MORE TOTAL: HOLD LEGACY ASSETS Allow current portfolio of assets to advance, fully funded by Partners; hold milestone & royalty payment rights BUY MORE & HOLD Acquire rights to additional potential milestone & royalty assets 45 ASSETS 38 ASSETS 7 ASSETS
Slide 11: Buy More & Hold
BUY MORE & HOLD ACQUIRE MILESTONE AND ROYALTY RIGHTS TO ADDITIONAL FULLY FUNDED ASSETS XOMA’S MODEL: HOLD & BUY MORE HOLD ALLOW PORTFOLIO OF ASSETS TO ADVANCE, FULLY FUNDED BY PARTNERS; HOLD MILESTONE & ROYALTY PAYMENT RIGHTS
Slide 12: Hold Strategy Component Requires Patience and Lean Infrastructure
HOLD STRATEGY COMPONENT REQUIRES 2 THINGS XOMA Spend PATIENCE TO PROVIDE TIME FOR UNDERLYING DRUG ASSETS TO ADVANCE THROUGH THE YEARS OF DISCOVERY, DEVELOPMENT AND APPROVAL A LEAN INFRASTRUCTURE TO MINIMIZE COSTS
Slide 13: XOMA's Portfolio - Partnered Programs
XOMA’S Portfolio - 45 Partnered Programs Preclinical Phase 1 Phase 1/2 Phase 2 Phase 3 NDA Filing Total Future Development Expenses by XOMA: $0 29 Assets with Large-Cap Partners 1 1 9 14 10 5 5
Slide 14: Diversification: Assets Across 10+ Therapeutic Categories
DIVERSIFICATION: 45 ASSETS ACROSS 10+ THERAPEUTIC CATEGORIES Oncology Other Immunology Diabetes Inflammation Infectious Diseases Cardiovascular Endocrinology Ophthalmology Dermatology
Slide 15: XOMA's Portfolio Key Highlights
COMPANY ASSET & PHASE OF DEVELOPMENT POTENTIAL MILESTONES ROYALTY % Novartis CFZ533 (Anti-CD40) Phase 2 $14M Mid single digits – low teens Takeda TAK-079 (Anti-CD38) Phase 1b/2 $21M 4% Novartis NIS793 (Anti-TGFβ) Phase 1b $480M Mid-single digits – low teens Rezolute XOMA 358 Phase 2 $232M High singl
Slide 16: Novartis' Expansive Development of Anti-CD40
INDICATION PHASE STATUS STUDY SIZE START DATE Lupus Nephritis 2 Recruiting 60 8/18 Systemic Lupus Erythematosus 2 Recruiting 120 9/18 Kidney Transplant 2 Recruiting 325 9/18 Liver Transplant 2 Not yet recruiting 128 12/18 Hidradenitis Suppurativa 2 Not yet recruiting 90 2/19 Primary Sjogren's Syndro
Slide 17: XOMA Assets Highlighted as Potential Blockbusters by Novartis
2 XOMA ASSETS HIGHLIGHTED AS POTENTIAL BLOCKBUSTERS BY NOVARTIS AT NOV 2018 R&D UPDATE XOMA Royalty Rate: Mid-single digits to low teens
Slide 18: Assets by Projected Peak Sales Potential
Royalty Rate at Projected Peak Sales < $500M (15 assets) $500M - $1B (11 assets) ≥ $1B (19 assets) < 2.5% 9 8 9 2.5% - <7.5% 5 2 7 7.5% - 15% 1 1 3 4 of 15 with Large-Cap Partners 8 of 11 with Large-Cap Partners 17 of 19 with Large-Cap Partners ASSETS BY PROJECTED PEAK SALES POTENTIAL SIGNIFICANT RO
Slide 19: Buy More & Hold
BUY MORE & HOLD ACQUIRE MILESTONE & ROYALTY RIGHTS TO ADDITIONAL FULLY FUNDED ASSETS XOMA’S MODEL: HOLD & BUY MORE HOLD ALLOW CURRENT PORTFOLIO OF ASSETS TO ADVANCE, FULLY FUNDED BY PARTNERS; HOLD MILESTONE & ROYALTY PAYMENT RIGHTS
Slide 20: XOMA Acquisition Strategy Is Distinct
XOMA ACQUISITION STRATEGY IS DISTINCT Acquire milestone and royalty licenses to high-potential, fully funded assets Focus on mid-clinical stage assets Partner companies pay all development costs Ever-increasing pipeline of potential targets Team entirely focused on acquiring new royalty assets THE B
Slide 21: Key Attributes of XOMA Target Assets
KEY ATTRIBUTES OF XOMA TARGET ASSETS PRE-COMMERCIAL THERAPEUTIC ASSETS Phase 1, 2, or 3 LONG DURATION OF MARKET EXCLUSIVITY Patent expiration or regulatory exclusivity HIGH REVENUE POTENTIAL High unmet need or clear clinical benefit over alternatives STRONG DEVELOPER/MARKETER Assets partnered with h
Slide 22: XOMA's First Royalty Monetization Transaction - Agenus
XOMA’S FIRST ROYALTY MONETIZATION TRANSACTION - AGENUS Total XOMA Investment: $15M 7 Assets with Large-Cap Partners 33% of Agenus’ Royalty Interest 10% 100% Immuno-Oncology Focus of Future Milestones
Slide 23: Agenus Transaction Hits All Key Attributes of XOMA Target Assets
AGENUS TRANSACTION HITS ALL KEY ATTRIBUTES OF XOMA TARGET ASSETS LONG DURATION EXCLUSIVITY HIGH REVENUE POTENTIAL STRONG DEVELOPER/MARKETER Rx PRE-COMMERCIAL THERAPEUTIC ASSETS 7 total assets; 5 in clinical development Potentially 10-years post commercialization Potentially important immuno-oncology
Slide 24: XOMA's Model: Hold & Buy More
26 XOMA’S MODEL: HOLD & BUY MORE TOTAL: HOLD LEGACY ASSETS Allow current portfolio of assets to advance, fully funded by Partners; hold milestone & royalty payment rights BUY MORE & HOLD Acquire rights to additional potential milestone & royalty assets 45 ASSETS 38 ASSETS 7 ASSETS
Slide 25: Recent Highlights
RECENT HIGHLIGHTS $20M Rights Offering led by BVF Partners Established $20M LoC with Silicon Valley Bank Acquired milestone & royalty interests in 6 Incyte assets & 1 Merck asset from Agenus for $15M Added $5.5M to the balance sheet in Feb ’19 from Rezolute milestone Added Barbara Kosacz, Partner at
Slide 26: Looking Ahead
LOOKING AHEAD Acquire additional milestone and royalty interest assets to take portfolio to >50 Maintain lean cost infrastructure and financial discipline Current balance sheet sufficient to fund operations for multiple years $1M per month core G&A expense Operational Novartis – gevokizumab Phase 1b
Slide 27: Why is XOMA's Portfolio Valuable?
Why is XOMA’s portfolio valuable? XOMA holds 45 current assets; pharmaceutical partners fund the research & development and cover 100% of costs XOMA sources royalty rights through deep industry network XOMA constructs an increasingly diverse and expanding portfolio to increase odds of success and mi