XOMA Corporation (XOMA) recently announced the closing of its common stock offering under which 8.7 million shares were issued at a price of $3.62 per share. The number of shares issued included 1.1 million shares issued on the exercise of the underwriters' over-allotment option.
XOMA said that it expects net proceeds of about $29.3 million. The funds should come in handy for the company's research and development efforts.
XOMA exited the second quarter of 2013 with cash and equivalents of about $57.9 million and expects to use about $50 million in 2013, mainly on its clinical and preclinical activities. The company expects research and development spend to increase this year mainly due to the ongoing global phase III development of lead candidate, gevokizumab, for non-infectious uveitis (NIU) and XOMA’s ongoing phase II proof-of-concept program.
Gevokizumab is being developed with Les Laboratoires Servier. Between the two companies, gevokizumab is currently in more than 12 studies covering 10 indications including six rare disease indications.
Some of the indications being studied include moderate to severe inflammatory acne (phase II results reported in Jan 2013), erosive osteoarthritis (EOA) of the hand with elevated C-reactive protein (phase II top-line results due in October), pyoderma gangrenosum (pilot study ongoing), reduction of plaque inflammation in patients with atherosclerosis (phase II ongoing) and polymyositis/dermatomyositis (proof-of-concept study ongoing).
Meanwhile, gevokizumab is currently in phase III development for NIU and Behçet’s uveitis. XOMA is conducting both the NIU studies (EYEGUARD-A and EYEGUARD-C) while the Behçet’s uveitis study is being sponsored by Servier.
XOMA currently carries a Zacks Rank #3 (Hold). At present, companies like Actelion Ltd. (ALIOF), Biogen Idec (BIIB) and Gilead Sciences, Inc. (GILD) look well-positioned with all three being Zacks Rank #1 (Strong Buy) stocks.
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