XERS.NASDAQXeris Biopharma Holdings, INC
10-Q: Xeris Biopharma Reports Q1 2025 Results: Revenue Climbs, Focus Remains on Commercial Growth
Sentiment:
Quarterly Report (Form 10-Q)
Xeris Biopharma's Q1 2025 shows revenue growth driven by key products, with a continued focus on commercialization and pipeline development.
Capital raiseThe company may continue to seek public equity and debt financing to meet its capital requirements.The company's ability to fund the marketing and selling of Recorlev, Gvoke and Keveyis, as well as its product development and clinical operations, including completion of future clinical trials, will depend on the amount and timing of cash received from product revenue and potential future financings.Accordingly, we may need to obtain additional financing in the future which may include public or private debt and/or equity financings.
Better than expectedThe company's net loss improved significantly, decreasing from $19.0 million in Q1 2024 to $9.2 million in Q1 2025.The company's revenue increased by 47.9% to $60.1 million compared to Q1 2024.
Summary
- Xeris Biopharma Holdings, Inc. reported its Q1 2025 financial results, highlighting revenue growth and ongoing efforts to commercialize its key products.
- Total revenue for the quarter increased to $60.1 million, up from $40.6 million in Q1 2024.
- Product revenue, net, reached $57.8 million, compared to $40.3 million in the same period last year.
- The company experienced a net loss of $9.2 million, a significant improvement from the $19.0 million loss in Q1 2024.
- Xeris is focused on maximizing the potential of its commercial products: Recorlev, Gvoke, and Keveyis.
- The company is also advancing its pipeline, including XP-8121, a once-weekly subcutaneous injection of levothyroxine for hypothyroidism.
- Xeris believes its cash resources are sufficient to sustain operations and capital expenditure requirements for at least the next 12 months.
- The company may seek additional financing through equity or debt if needed.
Sentiment
Score: 7
Explanation: The sentiment is moderately positive. Revenue growth and improved net loss are encouraging, but the company still faces challenges related to profitability and potential future financing needs.
Positives
- Significant revenue growth driven by Recorlev and Gvoke.
- Improved net loss compared to the same period last year.
- Strong patent portfolio protecting key products and technologies.
- Belief that current cash resources are sufficient for at least the next 12 months.
- Advancement of the XP-8121 pipeline candidate.
Negatives
- Keveyis net revenue decreased due to unfavorable net pricing.
- The company has a significant accumulated deficit of $681.1 million.
- Continued reliance on potential future financings to support operations.
Risks
- The company's ability to successfully commercialize its products and product candidates.
- The development of new technological innovations by competitors.
- The ability to acquire additional capital when needed and on acceptable terms.
- Protection of intellectual property.
- Reliance on single-source suppliers and manufacturers.
- Political and macroeconomic events and conditions.
- Market volatility resulting from announced or implemented U.S. trade tariffs and trade disputes with other countries, instability in the global credit markets, and geopolitical instability resulting from the ongoing military conflicts between Russia and Ukraine, Israel and Hamas and the potential for wider conflict in the Middle East, elevated and fluctuating interest rates, inflationary pressures, the tightening of lending standards, any further deterioration in the macroeconomic economy or financial services industry resulting from actual or potential bank failures or other factors could also adversely impact the Company's ability to access capital as and when needed.
Future Outlook
Xeris expects to continue to incur net losses for at least the next 12 months as it continues its marketing and selling efforts, research and development, and operations as a public company. The company believes its cash resources are sufficient to sustain operations and capital expenditure requirements for at least the next 12 months but may seek additional financing in the future.
Management Comments
- Our top priority is maximizing the potential of our three commercial products.
- We are pursuing formulation and development partnerships to apply our XeriSol and XeriJect formulation technologies to enhance the drug delivery and clinical profile of other companies proprietary drugs and biologics.
- Our strategy is to build a profitable biopharmaceutical company focused on developing and commercializing therapies for people with chronic endocrine and neurological diseases.
- Xeris is uniquely positioned to execute on this strategy through the continued growth of our three commercial products, which enables us to invest in and develop therapies for unmet medical needs.
- We believe this will generate a value to all of our stakeholders.
Industry Context
Xeris Biopharma operates in the competitive biopharmaceutical industry, focusing on therapies for chronic endocrine and neurological diseases. The company's performance is influenced by factors such as regulatory approvals, market acceptance of its products, and competition from other companies developing similar treatments. The company's proprietary formulation technologies provide a competitive advantage in developing ready-to-use, room-temperature stable, injectable formulations.
Comparison to Industry Standards
- Comparing Xeris Biopharma to similar specialty pharmaceutical companies like Strongbridge Biopharma (acquired by Xeris) and others in the endocrine and neurology space, revenue growth is a key metric.
- Companies like Horizon Therapeutics (now part of Amgen) and Neurocrine Biosciences serve as benchmarks for successful commercialization of specialized therapies.
- Xeris's focus on rare diseases like Cushing's syndrome and Primary Periodic Paralysis aligns with a trend in the industry towards developing treatments for niche markets with high unmet needs.
- The company's reliance on debt financing and potential future equity raises is common in the biopharmaceutical industry, particularly for companies in the commercialization stage.
- The company's gross margin of 84.9% is comparable to other specialty pharmaceutical companies with branded products.
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Non-Employee Director Compensation Policy | The Non-Employee Director Compensation Policy was amended effective January 1, 2025. | January 1, 2025 | The impact of the amendment is to update the compensation structure for non-employee directors to attract and retain high-caliber individuals. |
Legal Proceedings
- As of March 31, 2025, management was not aware of any existing, pending or threatened legal actions that would have a material impact on the financial position or results of operations of the Company.
Stakeholder Impact
- Shareholders: Potential for increased value through revenue growth and pipeline development.
- Employees: Continued employment and potential for growth within the company.
- Customers (Patients): Access to innovative therapies for chronic endocrine and neurological diseases.
- Suppliers: Ongoing business relationships and potential for increased demand.
- Creditors: Repayment of debt obligations and potential for future financing.
Next Steps
- Continue marketing and selling efforts for Recorlev, Gvoke, and Keveyis.
- Advance the development of XP-8121 and other pipeline candidates.
- Pursue formulation and development partnerships.
- Monitor market conditions and explore potential financing opportunities.
Key Dates
| Date | Description |
|---|---|
| March 10, 2017 | Date of Proprietary Information and Inventions Agreement between Xeris and Ken Johnson. |
| April 25, 2018 | Date of adoption of the Non-Employee Director Compensation Policy. |
| April 2018 | The 2018 Stock Option and Incentive Plan (the '2018 Plan') was adopted by the Board of Directors. |
| June 2018 | The 2018 Plan was approved by the Company's stockholders. |
| June 2018 | The 2018 Employee Stock Purchase Plan (the 'ESPP') was adopted by the Board of Directors and approved by the Company's stockholders. |
| February 2019 | The Equity Inducement Plan (the 'Inducement Plan') was adopted by the Board of Directors. |
| June 2020 | Xeris Pharma completed a public offering of $86.3 million aggregate principal amount of Xeris Pharma's 5.00% Convertible Senior Notes due 2025 (the '2025 Convertible Notes'). |
| July 2020 | $11.3 million pursuant to the underwriters' option to purchase additional notes, which was exercised in full. |
| January 15, 2021 | Since January 15, 2021, the 2025 Convertible Notes bear cash interest at the rate of 5.00% per annum, payable semi-annually in arrears on January 15 and July 15 of each year. |
| October 5, 2021 | Acquisition of Strongbridge Biopharma plc ('Strongbridge'). |
| May 11, 2022 | Entered into an Open Market Sale Agreement with Jefferies LLC, as agent, dated May 11, 2022 ('Sales Agreement') for the offering, issuance and sale of up to a maximum aggregate offering price of $75.0 million of common stock. |
| January 1, 2022 | Amendment to Non-Employee Director Compensation Policy effective. |
| August 9, 2022 | Amendment to Non-Employee Director Compensation Policy effective. |
| January 1, 2023 | Amendment to Non-Employee Director Compensation Policy effective. |
| September 29, 2023 | The Company completed the exchange of $32.0 million in aggregate principal amount of the 2025 Convertible Notes for $33.6 million in aggregate principal amount of new 8.00% Convertible Notes due 2028 (the '2028 Convertible Notes'). |
| March 5, 2024 | The Company, Xeris Pharma and certain subsidiary guarantors of the Company entered into an Amended and Restated Credit Agreement and Guaranty (the 'Amended and Restated Credit Agreement'). |
| January 1, 2024 | Amendment to Non-Employee Director Compensation Policy effective. |
| June 2024 | The Company's stockholders approved an amendment to the ESPP that removed the 'evergreen' provision which provided for annual increases in the aggregate number of shares available for issuance thereunder and increased the aggregate number of shares available for issuance thereunder by 6,636,632 additional shares. |
| August 1, 2024 | Amendment to Non-Employee Director Compensation Policy effective. |
| December 31, 2024 | Year end. |
| January 1, 2025 | Adoption of ASU 2024-02. |
| January 1, 2025 | Amendment to Non-Employee Director Compensation Policy effective. |
| February 2025 | The Company issued an aggregate of 450,585 of the Companys common stock pursuant to a notice of cashless exercise of 1,052,631 warrants by Hayfin Services LLP, as administrative agent for the Lenders under the Credit Agreement, and 209,633 warrants by Avenue Capital. |
| March 2025 | Certain holders of the 2025 Convertible Senior Notes converted $3.2 million in aggregate principal amount of the notes into 1,045,751 shares of the Company's common stock. |
| March 31, 2025 | End of Q1 2025. |
| April 1, 2025 | Consulting Agreement made April 1, 2025, is entered into by Xeris Pharmaceuticals, Inc. and Ken Johnson. |
| April 2, 2025 | Effective date of the Consulting Agreement between Xeris Pharmaceuticals, Inc. and Ken Johnson. |
| April 2025 | Certain holders of the 2025 Convertible Senior Notes converted the remaining $12.0 million in aggregate principal amount of the notes into 3,932,401 shares of the Company's common stock. |
| May 8, 2025 | Date of report. |
| September 2025 | Expiration date of 2018 Term B Warrants. |
| December 2025 | Expiration date of warrants in connection with Avenue Capital loan agreement. |
| February 1, 2026 | End date of the Consulting Agreement between Xeris Pharmaceuticals, Inc. and Ken Johnson. |
| December 2026 | Expiration date of warrants in connection with Horizon and Oxford loan agreement. |
| February 2027 | Expiration date of warrants in connection with Armistice securities purchase agreement. |
| March 2027 | Commitments to Taro The Company has a supply agreement with Taro Pharmaceuticals North America, Inc. ('Taro') to produce Keveyis. In 2023, the Company amended the agreement to extend the initial term until March 2027. |
| July 15, 2028 | The 2028 Convertible Notes will mature on July 15, 2028 unless earlier converted or redeemed or repurchased. |
| March 2029 | Expiration date of warrants in connection with Hayfin Amended and Restated Credit Agreement. |
| March 5, 2029 | The 2029 Loans will mature on March 5, 2029. |
| 2031 | Expiration of some non-cancellable operating leases for office and laboratory space. |
| 2036 | Expiration of some non-cancellable operating leases for office and laboratory space. |
| 2036 | Expiration of composition of matter patents covering ready-to-use glucagon formulation. |
| 2040 | Patent protection through 2040 for the use of Recorlev in the treatment of certain patients with persistent or recurrent Cushing's syndrome. |
Keywords
Xeris Biopharma, Financial Results, Q1 2025, Recorlev, Gvoke, Keveyis, Revenue, Net Loss, Commercialization, Pipeline Development, XP-8121, Pharmaceuticals
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