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What changed in Xenon Pharmaceuticals Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Xenon Pharmaceuticals Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+372 added−402 removedSource: 10-K (2024-12-31) vs 10-K (2023-12-31)

Top changes in Xenon Pharmaceuticals Inc.'s 2024 10-K

372 paragraphs added · 402 removed · 284 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

99 edited+32 added−53 removed246 unchanged
Biggest changeStatistical significance was achieved on the key secondary endpoint of a change in the Snaith-Hamilton Pleasure Scale, or SHAPS, measuring anhedonia at week 6 with a reduction of 5.30 in the placebo group and 7.77 in the XEN1101 20 mg group (p=0.046).
Biggest changeA significantly different change was achieved on the following additional endpoints in the study: • Pre-specified endpoint of the Hamilton Depression Rating Scale, or HAM-D17, at week 6 with a mean reduction of 10.18 in the placebo group and 13.26 in the azetukalner 20 mg group (p=0.042); • Key secondary endpoint of a change in the Snaith-Hamilton Pleasure Scale, or SHAPS, measuring anhedonia at week 6 with a reduction of 5.30 in the placebo group and 7.77 in the azetukalner 20 mg group (p=0.046); • MADRS at week 1 with a mean reduction of 4.88 in the placebo group and 7.54 in the azetukalner 20 mg group (p=0.047) demonstrating early onset of efficacy; and • At least minimally improved symptoms of depression as assessed by physicians using the Clinical Global Impression of Improvement, or CGI-I, (p=0.004) in the azetukalner 20 mg group compared to placebo.
In the U.S., for example, the Patient Protection and Affordable Care Act, as amended, or PPACA, is a sweeping law enacted in March of 2010 that expanded health care coverage through Medicaid expansion and the implementation of the individual mandate for health insurance coverage and which included changes to the coverage and reimbursement of drug products under government healthcare programs.
In the U.S., for example, the Patient Protection and Affordable Care Act, as amended, or PPACA, is a sweeping law enacted in March of 2010 that expanded healthcare coverage through Medicaid expansion and the implementation of the individual mandate for health insurance coverage and which included changes to the coverage and reimbursement of drug products under government healthcare programs.
In April 2017, we entered into an asset purchase agreement with 1st Order Pharmaceuticals, Inc., or 1st Order, pursuant to which we acquired all rights with respect to XEN1101 (previously known as 1OP2198). 1st Order previously acquired 1OP2198 from Valeant Pharmaceuticals Luxembourg S.a.r.l., an indirect subsidiary of Bausch Health Companies Inc., together with Valeant Pharmaceuticals Ireland Limited, Bausch Health, and assumed certain obligations, including potential milestone and royalty payments.
In April 2017, we entered into an asset purchase agreement with 1st Order Pharmaceuticals, Inc., or 1st Order, pursuant to which we acquired all rights with respect to azetukalner (previously known as 1OP2198 and XEN1101). 1st Order previously acquired 1OP2198 from Valeant Pharmaceuticals Luxembourg S.a.r.l., an indirect subsidiary of Bausch Health Companies Inc., together with Valeant Pharmaceuticals Ireland Limited, Bausch Health, and assumed certain obligations, including potential milestone and royalty payments.
Summary of X-TOLE Efficacy Results in the DBP : The X-TOLE trial met its primary efficacy endpoint with XEN1101 demonstrating a statistically significant and dose-dependent reduction from baseline in monthly (defined as 28 days) focal seizure frequency when compared to placebo (monotonic dose response; p 5 XEN1101 25 mg (N=112) XEN1101 20 mg (N=51) XEN1101 10 mg (N=46) Placebo (N=114) Median reduction from baseline in monthly focal seizure frequency 52.8% (p 46.4% (p 33.2% (p=0.035) 18.2% Patients with at least a 50% reduction in monthly focal seizure frequency from baseline 54.5% (p 43.1% (p 28.3% (p=0.037) 14.9% Patients with at least a 75% reduction in monthly focal seizure frequency from baseline 29.5% 29.4% 8.7% 6.1% Patients with 100% reduction in monthly focal seizure frequency from baseline 6.3% 7.8% 2.2% 1.8% Additional sub-analyses were performed in patients with different baseline characteristics given that X-TOLE included a difficult-to-treat patient population as defined by the number of prior failed ASMs, concomitant ASMs on study, and baseline seizure burden.
Summary of X-TOLE Efficacy Results in the DBP : The X-TOLE trial met its primary efficacy endpoint with azetukalner demonstrating a statistically significant and dose-dependent reduction from baseline in monthly (defined as 28 days) focal seizure frequency when compared to placebo (monotonic dose response; p Azetukalner 25 mg (n=112) Azetukalner 20 mg (n=51) Azetukalner 10 mg (n=46) Placebo (n=114) Median reduction from baseline in monthly focal seizure frequency 52.8% (p 46.4% (p 33.2% (p=0.035) 18.2% Patients with at least a 50% reduction in monthly focal seizure frequency from baseline 54.5% (p 43.1% (p 28.3% (p=0.037) 14.9% Patients with at least a 75% reduction in monthly focal seizure frequency from baseline 29.5% 29.4% 8.7% 6.1% Patients with 100% reduction in monthly focal seizure frequency from baseline 6.3% 7.8% 2.2% 1.8% 5 Additional sub-analyses were performed in patients with different baseline characteristics given that X-TOLE included a difficult-to-treat patient population as defined by the number of prior failed ASMs, concomitant ASMs on study, and baseline seizure burden.
The table below outlines a sub-group analyses of median percent reduction in seizures within the 25 mg dose group, showing that there was a significant increase in seizure reduction in patients with less disease severity at baseline: XEN1101 25 mg Median reduction from baseline in monthly focal seizures frequency Placebo Overall in X-TOLE 52.8% (N=112) 18.2% (n=114) Prior failed ASMs > 6 43.2% (n=45) 14.2% (n=47) Prior failed ASMs 6 58.3% (n=67) 20.5% (n=67) Concomitant ASMs = 3 51.3% (n=54) 20.4% (n=56) Concomitant ASMs 2 59.7% (n=58) 14.4% (n=58) Baseline seizures > 8.5 per month 50.8% (n=83) 18.2% (n=84) Baseline seizures 8.5 per month 70.6% (n=29) 18.8% (n=30) In addition, an analysis of seizure reduction across seizure subtypes showed a median percent reduction in monthly focal seizure frequency of 86.9% (n=23) in ‘type 4’ focal seizures that lead to generalized tonic clonic seizures in the 25 mg dose group.
The table below outlines a sub-group analyses of median percent reduction in seizures within the 25 mg dose group, showing that there was a significant increase in seizure reduction in patients with less disease severity at baseline: Azetukalner 25 mg Median reduction from baseline in monthly focal seizures frequency Placebo Overall in X-TOLE 52.8% (n=112) 18.2% (n=114) Prior failed ASMs > 6 43.2% (n=45) 14.2% (n=47) Prior failed ASMs 6 58.3% (n=67) 20.5% (n=67) Concomitant ASMs = 3 51.3% (n=54) 20.4% (n=56) Concomitant ASMs 2 59.7% (n=58) 14.4% (n=58) Baseline seizures > 8.5 per month 50.8% (n=83) 18.2% (n=84) Baseline seizures 8.5 per month 70.6% (n=29) 18.8% (n=30) In addition, an analysis of seizure reduction across seizure subtypes showed a median percent reduction in monthly focal seizure frequency of 86.9% (n=23) in ‘type 4’ focal seizures that lead to generalized tonic-clonic seizures in the 25 mg dose group.
Accordingly, submission of an IND does not guarantee the FDA will allow clinical trials to begin, or that, once begun, issues will not arise that could cause the trial to be suspended or terminated. If the FDA accepts the IND, the drug can then be studied in human clinical trials to determine if the drug is safe and effective.
Accordingly, submission of an IND does not guarantee the FDA will allow clinical trials to begin, or that, once begun, issues will not arise that could cause the trial to be suspended or terminated. 13 If the FDA accepts the IND, the drug can then be studied in human clinical trials to determine if the drug is safe and effective.
For the remainder of the upfront payment, concurrently with the entry into the Collaboration Agreement, the parties entered into the Share Purchase Agreement (as defined below) pursuant to which we issued and sold the Shares (as defined below) to Neurocrine Biosciences for an aggregate purchase price of $20.0 million.
For the remainder of the upfront payment, concurrently with the entry into the Collaboration Agreement, the parties entered into the Share Purchase Agreement (as defined below) pursuant to which we issued and sold common shares to Neurocrine Biosciences for an aggregate purchase price of $20.0 million.
We may be required to make further adjustments to our clinical trials or business operations based on current or future guidance and regulatory requirements as a result of major disruptions due to disasters and public health emergencies. 14 U.S.
We may be required to make further adjustments to our clinical trials or business operations based on current or future guidance and regulatory requirements as a result of major disruptions due to disasters and public health emergencies. U.S.
As more information is learned, unknown onset seizures may later be diagnosed as focal onset or generalized onset seizures. 7 Numerous ASMs are available for the treatment of seizures in the U.S., although there are fewer indicated for PGTCS.
As more information is learned, unknown onset seizures may later be diagnosed as focal onset or generalized onset seizures. Numerous ASMs are available for the treatment of seizures in the U.S., although there are fewer indicated for PGTCS.
Drug Development Process The process required by the FDA before a drug product may be marketed in the U.S. generally involves the following: • completion of nonclinical laboratory tests and animal studies according to good laboratory practices, or GLPs, and applicable requirements for the humane use of laboratory animals and other applicable regulations; • submission to the FDA of an application for an IND, which must become effective before human clinical studies may begin; • performance of adequate and well-controlled human clinical studies according to the FDA’s regulations commonly referred to as good clinical practices, or GCPs, and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product for its intended use; • submission to the FDA of an NDA for drug products for marketing approval that includes substantial evidence of safety and efficacy, which is usually based on large-scale Phase 3 clinical studies; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities where the product is produced to assess compliance with good manufacturing practices, or GMP, to assure that the facilities, methods and controls are adequate to consistently manufacture the product pursuant to regulatory requirements; • potential FDA inspection of the nonclinical and clinical study sites that generated the data in support of the NDA; and • payment of applicable user fees and FDA review and approval of the NDA. 13 The data required to support an NDA is generated in two distinct development stages: pre-clinical and clinical.
Drug Development Process The process required by the FDA before a drug product may be marketed in the U.S. generally involves the following: • completion of nonclinical laboratory tests and animal studies according to good laboratory practices, or GLPs, and applicable requirements for the humane use of laboratory animals and other applicable regulations; • submission to the FDA of an application for an IND, which must become effective before human clinical studies may begin; • performance of adequate and well-controlled human clinical studies according to the FDA’s regulations commonly referred to as good clinical practices, or GCPs, and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product for its intended use; • submission to the FDA of an NDA for drug products for marketing approval that includes substantial evidence of safety and efficacy, which is usually based on large-scale Phase 3 clinical studies; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities where the product is produced to assess compliance with good manufacturing practices, or GMP, to assure that the facilities, methods and controls are adequate to consistently manufacture the product pursuant to regulatory requirements; • potential FDA inspection of the nonclinical and clinical study sites that generated the data in support of the NDA; and • payment of applicable user fees and FDA review and approval of the NDA.
The secondary objectives are to test the effect of XEN1101 compared to placebo on clinical measures of depression and anhedonia using the MADRS and SHAPS, respectively. 8 About Major Depressive Disorder (MDD) MDD is a common, chronic neurological disorder characterized by low mood, inability to feel pleasure, feelings of guilt and worthlessness, low energy, and other emotional and physical symptoms that last for two weeks or more, and which impairs social, occupational, educational, or other important functioning.
The secondary objectives are to test the effect of azetukalner compared to placebo on clinical measures of depression and anhedonia using the MADRS and SHAPS, respectively. 8 About Major Depressive Disorder (MDD) MDD is a common, chronic neurological disorder characterized by low mood, inability to feel pleasure, feelings of guilt and worthlessness, low energy, and other emotional and physical symptoms that last for two weeks or more, and which impairs social, occupational, educational, or other important functioning.
There can be no assurance that our products will be considered medically reasonable and necessary for a specific indication, that our products will be considered cost-effective by third-party payers, that coverage or an adequate level of reimbursement will be available or that the third-party payers’ reimbursement policies will not adversely affect our ability to sell our products profitably. 23 In addition, in many foreign countries, the proposed pricing for a drug must be approved before it may be lawfully marketed.
There can be no assurance that our products will be considered medically reasonable and necessary for a specific indication, that our products will be considered cost-effective by third-party payers, that coverage or an adequate level of reimbursement will be available or that the third-party payers’ reimbursement policies will not adversely affect our ability to sell our products profitably. 22 In addition, in many foreign countries, the proposed pricing for a drug must be approved before it may be lawfully marketed.
A “similar medicinal product” is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is intended for the same therapeutic indication. 22 In the EEA, companies developing a new medicinal product must agree upon a pediatric investigation plan ("PIP"), with the EMA’s Pediatric Committee (the "PDCO"), and must conduct pediatric clinical trials in accordance with that PIP, unless a waiver applies.
A “similar medicinal product” is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is intended for the same therapeutic indication. 21 In the EEA, companies developing a new medicinal product must agree upon a pediatric investigation plan, or PIP, with the EMA’s Pediatric Committee, or PDCO, and must conduct pediatric clinical trials in accordance with that PIP, unless a waiver applies.
In September 2018, we signed an agreement with Bausch Health to buy out all future milestone payments and royalties owed to Bausch Health with respect to XEN1101, including up to $39.6 million in potential clinical development, regulatory and sales-based milestones and a mid-to-high single digit percentage royalty on commercial sales in exchange for a one-time payment of $6.0 million.
In September 2018, we signed an agreement with Bausch Health to buy out all future milestone payments and royalties owed to Bausch Health with respect to azetukalner, including up to $39.6 million in potential clinical development, regulatory and sales-based milestones and a mid-to-high single digit percentage royalty on commercial sales in exchange for a one-time payment of $6.0 million.
We had one wholly-owned subsidiary as of December 31, 2023, Xenon Pharmaceuticals USA Inc., which was incorporated in Delaware on December 2, 2016. Our principal executive offices are located at 3650 Gilmore Way, Burnaby, British Columbia, Canada V5G 4W8, and our telephone number is (604) 484-3300.
We had one wholly-owned subsidiary as of December 31, 2024, Xenon Pharmaceuticals USA Inc., which was incorporated in Delaware on December 2, 2016. Our principal executive offices are located at 3650 Gilmore Way, Burnaby, British Columbia, Canada V5G 4W8, and our telephone number is (604) 484-3300.
Similar to the EU, before a clinical trial can be initiated in the UK, a CTA must be obtained from the Medicines and Healthcare products Regulatory Agency, or MHRA, as well as a positive opinion from a REC. 20 To obtain regulatory approval of an investigational drug under EU regulatory systems, we must submit a marketing authorization application, or MAA.
Similar to the EU, before a clinical trial can be initiated in the UK, a CTA must be obtained from the Medicines and Healthcare products Regulatory Agency, or MHRA, as well as a positive opinion from a REC. 19 To obtain regulatory approval of an investigational drug under EU regulatory systems, we must submit a marketing authorization application, or MAA.
The application used to file the NDA in the U.S. is similar to that required in the EU, with the exception of, among other things, country-specific document requirements. Reimbursement approval for the drug by regulatory authorities is also required before a drug may be commercialized. 21 The EU also provides opportunities for data and market exclusivity.
The application used to file the NDA in the U.S. is similar to that required in the EU, with the exception of, among other things, country-specific document requirements. Reimbursement approval for the drug by regulatory authorities is also required before a drug may be commercialized. 20 The EU also provides opportunities for data and market exclusivity.
The distribution of drugs and biological products is subject to additional requirements and regulations, including extensive record-keeping, licensing, storage and security requirements intended to prevent the unauthorized sale of pharmaceutical products. 25 Federal and state consumer protection and unfair competition laws and regulations broadly regulate marketplace activities and that potentially harm consumers and could apply to the activities of pharmaceutical manufacturers.
The distribution of drugs and biological products is subject to additional requirements and regulations, including extensive record-keeping, licensing, storage and security requirements intended to prevent the unauthorized sale of pharmaceutical products. 24 Federal and state consumer protection and unfair competition laws and regulations broadly regulate marketplace activities and that potentially harm consumers and could apply to the activities of pharmaceutical manufacturers.
Investigator-Led Phase 2 Proof-of-Concept Study of XEN1101 in MDD We are also collaborating with the Icahn School of Medicine at Mount Sinai to support an ongoing investigator-sponsored Phase 2 proof-of-concept, randomized, parallel-arm, placebo-controlled multi-site study of XEN1101 for the treatment of MDD in approximately 60 subjects.
Investigator-Led Phase 2 Proof-of-Concept Study of Azetukalner in MDD We are also collaborating with the Icahn School of Medicine at Mount Sinai to support an ongoing investigator-sponsored Phase 2 proof-of-concept, randomized, parallel-arm, placebo-controlled multi-site study of azetukalner for the treatment of MDD in approximately 60 subjects.
Complying with any new legislation and regulatory changes could be time-intensive and expensive, resulting in a material adverse effect on our business. 24 Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products.
Complying with any new legislation and regulatory changes could be time-intensive and expensive, resulting in a material adverse effect on our business. 23 Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products.
The incidence of treatment-emergent adverse events, or TEAEs, was higher in the treatment groups as compared to the placebo group, with 62.3% of patients in the placebo group, 67.4% of patients in the XEN1101 10 mg group, 68.6% of patients in the XEN1101 20 mg group, and 85.1% of patients in the XEN1101 25 mg group experiencing at least one TEAE.
The incidence of treatment-emergent adverse events, or TEAEs, was higher in the treatment groups as compared to the placebo group, with 62.3% of patients in the placebo group, 67.4% of patients in the azetukalner 10 mg group, 68.6% of patients in the azetukalner 20 mg group, and 85.1% of patients in the azetukalner 25 mg group experiencing at least one TEAE.
Importantly, two U.S. patents were issued in 2021 with claims covering: (1) distinct crystalline forms of XEN1101 drug substance and related pharmaceutical compositions, along with methods for their preparation and use; and (2) various methods of orally administering XEN1101 with or close to a meal.
Importantly, two U.S. patents were issued in 2021 with claims covering: (1) distinct crystalline forms of azetukalner drug substance and related pharmaceutical compositions, along with methods for their preparation and use; and (2) various methods of orally administering azetukalner with or close to a meal.
The incidence of treatment-emergent serious adverse events, or SAEs, was similar in all four arms of the study with 2.6% of patients in the placebo group, 4.3% of patients in the XEN1101 10 mg group, 3.9% of patients in the XEN1101 20 mg group, and 2.6% of patients in the XEN1101 25 mg group experiencing at least one treatment-emergent SAE.
The incidence of treatment-emergent serious adverse events, or SAEs, was similar in all four arms of the study with 2.6% of patients in the placebo group, 4.3% of patients in the azetukalner 10 mg group, 3.9% of patients in the azetukalner 20 mg group, and 2.6% of patients in the azetukalner 25 mg group experiencing at least one treatment-emergent SAE.
No serious adverse events, or SAEs, were reported in the two XEN1101 treatment groups and there were two patients (3.6%) in the placebo group who experienced a treatment-emergent SAE. XEN1101 was not associated with notable weight gain, and patients did not report notable sexual dysfunction.
No serious adverse events, or SAEs, were reported in the two azetukalner treatment groups and there were two patients (3.6%) in the placebo group who experienced a treatment-emergent SAE. Azetukalner was not associated with notable weight gain, and patients did not report notable sexual dysfunction.
In the United States, the activities of pharmaceutical manufacturers are subject to federal and state laws designed to prevent “fraud and abuse” in the healthcare industry. The laws generally limit financial interactions between manufacturers and health care providers or other participants in the healthcare industry and/or require disclosure to the government and public of such interactions.
In the United States, the activities of pharmaceutical manufacturers are subject to federal and state laws designed to prevent “fraud and abuse” in the healthcare industry. The laws generally limit financial interactions between manufacturers and healthcare providers or other participants in the healthcare industry and/or require disclosure to the government and public of such interactions.
The median baseline seizure frequency across the study groups was approximately 13.5 seizures per month. Of the 285 subjects who completed the double-blind period, 96.5% entered the OLE to evaluate the long-term safety, tolerability, and effectiveness of XEN1101.
The median baseline seizure frequency across the study groups was approximately 13.5 seizures per month. Of the 285 subjects who completed the double-blind period, 96.5% entered the OLE to evaluate the long-term safety, tolerability, and effectiveness of azetukalner.
Summary of X-NOVA Efficacy Data in the DBP: The primary endpoint of the study was a change in MADRS at week 6. The mean reduction was 13.90 in the placebo group, 15.61 in the XEN1101 10 mg group and 16.94 in the XEN1101 20 mg group.
Summary of X-NOVA Efficacy Data in the DBP: The primary endpoint of the study was a change in MADRS at week 6. The mean reduction was 13.90 in the placebo group, 15.61 in the azetukalner 10 mg group and 16.94 in the azetukalner 20 mg group.
Foreign regulation of controlled substances can differ significantly from U.S. DEA and state regulations. The time required to obtain marketing approval and controlled substance classification in other countries may differ from and be longer than that required to obtain FDA approval and DEA classification in the U.S. 18 U.S.
Foreign regulation of controlled substances can differ significantly from U.S. DEA and state regulations. The time required to obtain marketing approval and controlled substance classification in other countries may differ from and be longer than that required to obtain FDA approval and DEA classification in the U.S. 17 U.S.
If any such changes were to be imposed, they could adversely affect the operation of our business. 19 Global Anti-Corruption Laws The U.S. Foreign Corrupt Practices Act and the Canadian Corruption of Foreign Public Officials Act, the U.S.
If any such changes were to be imposed, they could adversely affect the operation of our business. 18 Global Anti-Corruption Laws The U.S. Foreign Corrupt Practices Act and the Canadian Corruption of Foreign Public Officials Act, the U.S.
The most commonly reported TEAEs in the XEN1101 20 mg group included dizziness (17.9%), somnolence (10.7%), headache (8.9%) and disturbance in attention (8.9%), as compared to the placebo group which reported dizziness (7.3%), somnolence (1.8%), headache (12.7%) and disturbance in attention (0%).
The most commonly reported TEAEs in the azetukalner 20 mg group included dizziness (17.9%), somnolence (10.7%), headache (8.9%) and disturbance in attention (8.9%), as compared to the placebo group which reported dizziness (7.3%), somnolence (1.8%), headache (12.7%) and disturbance in attention (0%).
Rates of discontinuation were similar across all treatment arms and rates of discontinuation due to TEAEs were low with three patients in the XEN1101 20 mg group (5.4%), as compared to two patients in the placebo group (3.6%).
Rates of discontinuation were similar across all treatment arms and rates of discontinuation due to TEAEs were low with three patients in the azetukalner 20 mg group (5.4%), as compared to two patients in the placebo group (3.6%).
A time-to-event analysis analyzing the time to reach the baseline monthly focal seizure count during the double-blind period showed a marked dose-dependent decrease in the rate of seizure recurrence when comparing XEN1101 to placebo.
A time-to-event analysis analyzing the time to reach the baseline monthly focal seizure count during the double-blind period showed a marked dose-dependent decrease in the rate of seizure recurrence when comparing azetukalner to placebo.
There were 3.5% of subjects in the placebo group, 2.2% of subjects in the XEN1101 10 mg group, 13.7% of subjects in the XEN1101 20 mg group, and 15.8% of subjects in the XEN1101 25 mg group that had an AE leading to treatment discontinuation.
There were 3.5% of subjects in the placebo group, 2.2% of subjects in the azetukalner 10 mg group, 13.7% of subjects in the azetukalner 20 mg group, and 15.8% of subjects in the azetukalner 25 mg group that had an AE leading to treatment discontinuation.
The primary objective of the study is to investigate the effect of XEN1101 on the brain reward circuit as measured by the change in bilateral ventral striatum activity as assessed by functional MRI, or fMRI.
The primary objective of the study is to investigate the effect of azetukalner on the brain reward circuit as measured by the change in bilateral ventral striatum activity as assessed by functional MRI, or fMRI.
Across all XEN1101 dose groups (n=211), the most common TEAEs were dizziness (n=52, 24.6%), somnolence (n=33, 15.6%), fatigue (n=23, 10.9%), and headache (n=21, 10.0%).
Across all azetukalner dose groups (n=211), the most common TEAEs were dizziness (n=52, 24.6%), somnolence (n=33, 15.6%), fatigue (n=23, 10.9%), and headache (n=21, 10.0%).
A clear dose response and a clinically meaningful, but not statistically significant, 3.04 difference between placebo and the XEN1101 20 mg group (p=0.135) was observed.
A clear dose response and a clinically meaningful, but not statistically significant, 3.04 difference between placebo and the azetukalner 20 mg group (p=0.135) was observed.
We may be subject to various federal and state laws pertaining to health care “fraud and abuse,” including anti kickback laws, and false claims laws, for activities related to past and future sales of any products reimbursable by third party payers such as federal health care programs (including Medicare and Medicaid) or, in some cases, commercial health plans.
We may be subject to various federal and state laws pertaining to healthcare “fraud and abuse,” including anti kickback laws, and false claims laws, for activities related to sales of any products reimbursable by third party payers such as federal healthcare programs (including Medicare and Medicaid) or, in some cases, commercial health plans.
The laws and regulations generally limit financial interactions between manufacturers and health care providers; require manufacturers to adopt certain compliance standards; require disclosure to the government and public of financial interactions; require disclosure of marketing expenditures or pricing information, regulate drug pricing and/or require the registration of pharmaceutical sales representatives.
The laws and regulations generally limit financial interactions between manufacturers and healthcare providers; require manufacturers to adopt certain compliance standards; require disclosure to the government and public of financial interactions; require disclosure of marketing expenditures or pricing information, regulate drug pricing and/or require the registration of pharmaceutical sales representatives.
FDA approval of an investigational new drug application, or IND, must be obtained before clinical testing of drugs is initiated, and each clinical study protocol for such product candidates is reviewed by the FDA and an institutional review board, or IRB, prior to initiation in the U.S. FDA approval also must be obtained before marketing of drugs in the U.S.
FDA approval of an IND, must be obtained before clinical testing of drugs is initiated, and each clinical study protocol for such product candidates is reviewed by the FDA and an institutional review board, or IRB, prior to initiation in the U.S. FDA approval also must be obtained before marketing of drugs in the U.S.
Intellectual Property Related to XEN1101 We have a comprehensive strategy in place to protect and expand the intellectual property portfolio that covers XEN1101.
Intellectual Property Related to Azetukalner We have a comprehensive strategy in place to protect and expand the intellectual property portfolio that covers azetukalner.
In addition to our proprietary product candidates, we also have partnered programs with academic and industry collaborators, including Neurocrine Biosciences, Inc., or Neurocrine Biosciences. Our Strategy Our goal is to build a fully-integrated and profitable biopharmaceutical company that discovers, develops, and commercializes innovative therapeutics to treat a range of neuroscience diseases.
In addition to our proprietary product candidates, we also have partnered programs with academic and industry collaborators, including Neurocrine Biosciences, Inc., or Neurocrine Biosciences. Our Strategy Our goal is to build a fully-integrated and profitable biopharmaceutical company that discovers, develops, and commercializes innovative therapeutics to treat a range of neurological and psychiatric disorders.
Summary of X-NOVA Safety and Tolerability Data in the DBP: XEN1101 was well tolerated with similar rates of adverse events reported across all treatment arms.
Summary of X-NOVA Safety and Tolerability Data in the DBP: Azetukalner was generally well tolerated with similar rates of adverse events reported across all treatment arms.
Unless earlier terminated, the term of the Collaboration Agreement will continue on a product-by-product and country-by-country basis until the expiration of the Royalty Term for such product in such country. 10 Neurocrine Biosciences may terminate the Collaboration Agreement in its entirety or on a product-by-product or country-by-country basis, for any or no reason, by providing at least 90 days’ written notice, provided that such unilateral termination will not be effective (i) with respect to a NBI-921352 product until Neurocrine Biosciences has used its commercially reasonable efforts to complete one Phase 2 clinical trial for a NBI-921352 product; (ii) with respect to a DTC product until Neurocrine Biosciences has used its commercially reasonable efforts to complete one Phase 1 clinical trial for a DTC product; and (iii) with respect to the Collaboration Agreement in its entirety until Neurocrine Biosciences has used its commercially reasonable efforts to complete both of these clinical trials.
Neurocrine Biosciences may terminate the Collaboration Agreement in its entirety or on a product-by-product or country-by-country basis, for any or no reason, by providing at least 90 days’ written notice, provided that such unilateral termination will not be effective (i) with respect to a NBI-921352 product until Neurocrine Biosciences has used its commercially reasonable efforts to complete one Phase 2 clinical trial for a NBI-921352 product; (ii) with respect to a DTC product until Neurocrine Biosciences has used its commercially reasonable efforts to complete one Phase 1 clinical trial for a DTC product; and (iii) with respect to the Collaboration Agreement in its entirety until Neurocrine Biosciences has used its commercially reasonable efforts to complete both of these clinical trials.
Pursuant to our collaboration with Neurocrine Biosciences, Neurocrine Biosciences controls the prosecution, maintenance and other matters relating to the patent portfolio for NBI-921352 and the other selective Nav1.6 inhibitors and dual Nav1.2/1.6 inhibitors, although we have a right to comment.
Pursuant to our collaboration with Neurocrine Biosciences, Neurocrine Biosciences controls the prosecution, maintenance and other matters relating to the patent portfolio for the selective Nav1.6 inhibitors and dual Nav1.2/1.6 inhibitors subject thereto, although we have a right to comment.
Sales-based milestones of up to $150.0 million for each Compound, including a NBI-921352 product, will be paid from Neurocrine Biosciences to us upon the achievement of certain Net Sales targets, up to a maximum of four Compounds.
Sales-based milestones of up to $150.0 million for each Compound will be paid from Neurocrine Biosciences to us upon the achievement of certain Net Sales targets, up to a maximum of four Compounds.
We continuously strive to ensure that employee morale remains strong, and conduct employee engagement surveys to identify areas of focus and monitor employee turnover rates. As of December 31, 2023, and for the last several years, our company turnover rate was and has been lower than the industry market average.
We continuously strive to ensure that employee morale remains strong, and conduct employee engagement surveys to identify areas of focus and monitor employee turnover rates. For the last several years, our company turnover rate has been lower than the industry market average.
In January 2022, we received an aggregate milestone payment of $15.0 million in the form of a $6.75 million payment in cash and a $8.25 million equity investment, based on the FDA’s acceptance of a protocol amendment to expand the study population of a clinical trial in pediatric patients with SCN8A-DEE.
In January 2022, we received an aggregate milestone payment of $15.0 million in the form of a $6.75 million payment in cash and a $8.25 million equity investment, based on the U.S. Food and Drug Administration's, or FDA’s, acceptance of a protocol amendment to expand the study population of a clinical trial in pediatric patients with SCN8A-DEE.
The SEC maintains a website that contains reports, proxy and information statements, and other information regarding reports that we file or furnish electronically with them at www.sec.gov. Additional information related to Xenon is also available on SEDAR at www.sedar.com. 27
The SEC maintains a website that contains reports, proxy and information statements, and other information regarding reports that we file or furnish electronically with them at www.sec.gov. Additional information related to Xenon is also available on SEDAR+ at www.sedarplus.ca. 26
Our product candidates that are in clinical development may compete with various therapies and drugs, both in the marketplace and currently under development. 12 If one or more of our proprietary or partnered product candidates were approved for the treatment of epilepsy, we anticipate that they could potentially compete with other ASMs or one another.
Our product candidates that are in clinical development may compete with various therapies and drugs, both in the marketplace and currently under development. If one or more of our proprietary or partnered product candidates is approved for the treatment of epilepsy, we anticipate that they could potentially compete with other anti-seizure medications, or ASMs, or one another.
XEN1101 for Major Depressive Disorder (MDD) In November 2023, we reported topline results from the randomized, double-blind, placebo-controlled, Phase 2 proof-of-concept X-NOVA clinical trial, which evaluated the clinical efficacy, safety, and tolerability of 10 mg and 20 mg of XEN1101 taken once daily with food in 168 patients with moderate to severe major depressive disorder, or MDD.
Summary of Azetukalner Clinical Results in MDD Phase 2 Proof-of-Concept X-NOVA Clinical Trial: In November 2023, we reported topline results from the randomized, double-blind, placebo-controlled, Phase 2 proof-of-concept X-NOVA clinical trial, which evaluated the clinical efficacy, safety, and tolerability of 10 mg and 20 mg of azetukalner taken once daily with food in 168 patients with moderate to severe MDD.
These currently commonly prescribed ASMs, among others, include brivaracetam, carbamazepine, cenobamate, clobazam, eslicarbazepine acetate, ethosuximide, gabapentin, lacosamide, lamotrigine, levetiracetam, oxcarbazepine, perampanel, phenytoin, topiramate, and valproate.
Commonly prescribed ASMs include brivaracetam, carbamazepine, cenobamate, clobazam, eslicarbazepine acetate, ethosuximide, gabapentin, lacosamide, lamotrigine, levetiracetam, oxcarbazepine, perampanel, phenytoin, topiramate, and valproate.
This multicenter, randomized, double-blind, placebo-controlled study is evaluating the clinical efficacy, safety, and tolerability of 25 mg of XEN1101 administered with food as adjunctive treatment in approximately 160 patients with PGTCS. The primary efficacy endpoint is the MPC in monthly PGTCS frequency from baseline through the DBP of XEN1101 compared to placebo.
X-ACKT is a multicenter, randomized, double-blind, placebo-controlled study evaluating the clinical efficacy, safety, and tolerability of 25 mg of azetukalner administered with food as adjunctive treatment in approximately 160 patients with PGTCS. The primary efficacy endpoint is the MPC in monthly PGTCS frequency from baseline through the 12-week DBP of azetukalner compared to placebo.
Of our employees, 190 were primarily engaged in research and development, 78 of whom hold a Ph.D. or M.D. (or equivalent) degree, and 69 were engaged in general and administrative or commercial activities. None of our employees are represented by a labor union.
Of our employees, 239 were primarily engaged in research and development, 98 of whom hold a Ph.D. or M.D. (or equivalent) degree, and 88 were engaged in general and administrative or commercial activities. None of our employees are represented by a labor union.
With regard to our selective inhibitors of Nav1.6 and/or Nav1.2 (exclusive of NBI-921352), as of December 31, 2023, we owned 6 U.S. issued patents, 15 issued patents in foreign jurisdictions (exclusive of European patent national validations), and over 90 pending patent applications.
With regard to our selective inhibitors of Nav1.6 and/or Nav1.2, as of December 31, 2024, we owned 10 U.S. issued patents, 43 issued patents in foreign jurisdictions (exclusive of European patent national validations), and over 90 pending patent applications.
These marked reductions in seizures were associated with statistically significant improvements in overall status, as assessed by physicians using the Clinical Global Impression of Change, or CGI-C, and by subject self-reporting using the Patient Global Impression of Change, or PGI-C, scales in the XEN1101 25 mg group, which are shown in the table below: XEN1101 25 mg (N=112) Placebo (N=114) CGI-C (Portion of patients much improved or very much improved) 46.4% (p 22.8% PGI-C (Portion of patients much improved or very much improved) 42.9% (p=0.001) 21.9% The XEN1101 25 mg group was statistically significant in CGI-C and PGI-C, and the XEN1101 20 mg group was statistically significant in PGI-C, while the XEN1101 20 mg group in CGI-C and the XEN1101 10 mg group for both CGI-C and PGI-C showed numerical improvements over placebo but were not statistically significant. 6 Summary of X-TOLE Safety Results in the DBP : XEN1101 was generally well-tolerated in the DBP with AEs consistent with other ASMs.
These marked reductions in seizures were associated with statistically significant improvements in overall status, as assessed by physicians using the Clinical Global Impression of Change, or CGI-C, and by subject self-reporting using the Patient Global Impression of Change, or PGI-C, scales in the azetukalner 25 mg group, which are shown in the table below: Azetukalner 25 mg (n=112) Placebo (n=114) CGI-C (Portion of patients much improved or very much improved) 46.4% (p 22.8% PGI-C (Portion of patients much improved or very much improved) 42.9% (p=0.001) 21.9% The azetukalner 25 mg group was statistically significant in CGI-C and PGI-C, and the azetukalner 20 mg group was statistically significant in PGI-C, while the azetukalner 20 mg group in CGI-C and the azetukalner 10 mg group for both CGI-C and PGI-C showed numerical improvements over placebo but were not statistically significant.
Human Capital Our board of directors and management recognize that creating long-term enterprise value is advanced by considering the interests and concerns of many stakeholders, including those of our employees. As of December 31, 2023, we had 259 employees, including 251 full-time and part-time permanent employees, of which 179 are located in Canada and 72 are located in the U.S.
Human Capital Our board of directors and management recognize that creating long-term enterprise value is advanced by considering the interests and concerns of many stakeholders, including those of our employees. As of December 31, 2024, we had 327 employees, including 316 full-time and part-time permanent employees, of which 181 are located in Canada and 135 are located in the U.S.
We have not exercised this option as of December 31, 2023. Neurocrine Biosciences paid us an upfront payment of $50.0 million, which included a $30.0 million payment in cash.
We have not exercised this option as of February 27, 2025. Neurocrine Biosciences paid us an upfront payment of $50.0 million, which included a $30.0 million payment in cash.
The review process and the PDUFA goal date may be extended by three months if, within the last three months before the PDUFA goal date, the FDA requests (or the application sponsor otherwise provides) a substantial amount of new data or new information not previously submitted to, or reviewed by, the FDA (e.g., a major new clinical safety or efficacy study report, a proposed REMS), or a new analysis or major reanalysis of studies previously submitted to the pending application. 15 Post-Approval Requirements Rigorous and extensive FDA regulation of drug continues after approval, particularly with respect to GMP.
The review process and the PDUFA goal date may be extended by three months if, within the last three months before the PDUFA goal date, the FDA requests (or the application sponsor otherwise provides) a substantial amount of new data or new information not previously submitted to, or reviewed by, the FDA (e.g., a major new clinical safety or efficacy study report, a proposed REMS), or a new analysis or major reanalysis of studies previously submitted to the pending application.
RMT increased in proportion to XEN1101 plasma concentration showing a mean ± standard error of mean increase of 4.9 ± 0.7% (p Phase 2b X-TOLE Clinical Trial: In October 2021, we announced topline results from the Phase 2b X-TOLE clinical trial, which was designed as a randomized, double-blind, placebo-controlled, multicenter study to evaluate the clinical efficacy, safety, and tolerability of 10 mg, 20 mg, or 25 mg of XEN1101 administered as once-daily adjunctive treatment with food in adult patients with focal epilepsy.
Phase 2b X-TOLE Clinical Trial: In October 2021, we announced topline results from the Phase 2b X-TOLE clinical trial, which was designed as a randomized, double-blind, placebo-controlled, multicenter study to evaluate the clinical efficacy, safety, and tolerability of 10 mg, 20 mg, or 25 mg of azetukalner administered as once-daily adjunctive treatment with food in adult patients with focal epilepsy.
The primary objective was to assess the efficacy of XEN1101 compared to placebo on improvement of depressive symptoms in subjects diagnosed with moderate to severe MDD, using the Montgomery-Åsberg Depression Rating Scale, or MADRS, score change through week 6. We anticipate participating in an “end-of-Phase 2” meeting with the U.S.
The primary objective was to assess the efficacy of azetukalner compared to placebo on improvement of depressive symptoms in subjects diagnosed with moderate to severe MDD, using the Montgomery-Åsberg Depression Rating Scale, or MADRS, score change through week 6.
There are other ASMs in development that could potentially compete with our products, including product candidates in development from Biohaven Ltd., Cerevel Therapeutics Holdings, Inc., Equilibre Biopharmaceuticals Corp., Johnson & Johnson Innovative Medicine, Neurona Therapeutics Inc., Praxis Precision Medicines, Inc., Rapport Therapeutics, Inc., SK Life Science Inc., Supernus Pharmaceuticals, Inc., and Zhimeng Biopharma, Inc.
There are other ASMs in development that could potentially compete with our products, including product candidates in development from AbbVie Inc., Biohaven Ltd., Neurona Therapeutics Inc., NeuShen Therapeutics, Inc., Praxis Precision Medicines, Inc., QurAlis Corporation, Rapport Therapeutics, Inc., SK Life Science Inc., Supernus Pharmaceuticals, Inc. and Zhimeng Biopharma, Inc.
We are aware of several companies developing product candidates for the treatment of MDD including AbbVie Inc., Biohaven Ltd., Intra-Cellular Therapies, Inc., Johnson & Johnson Innovative Medicine, Neumora Therapeutics, Inc., Relmada Therapeutics, Inc., Sage Therapeutics, Inc. and Sumitomo Pharma America, Inc.
We are aware of several companies developing product candidates for the treatment of MDD including AbbVie Inc., Alto Neuroscience, Inc., Axsome Therapeutics, Inc., Biohaven Ltd., Intra-Cellular Therapies, Inc., Johnson & Johnson Innovative Medicine, Neumora Therapeutics, Inc., and Neurocrine Biosciences, Inc.
FDASIA also codified and expanded on FDA’s accelerated approval regulations, under which FDA may approve a drug for a serious or life threatening illness that provides meaningful therapeutic benefit over existing treatments based on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on an intermediate clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit.
For breakthrough therapies, the FDA may take certain actions, such as intensive and early guidance on the drug development program, that are intended to expedite the development and review of an application for approval. 16 FDASIA also codified and expanded on FDA’s accelerated approval regulations, under which FDA may approve a drug for a serious or life threatening illness that provides meaningful therapeutic benefit over existing treatments based on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on an intermediate clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit.
During the term of the Collaboration Agreement, other than the Excluded Compounds and otherwise in accordance with the terms of the Collaboration Agreement, neither we nor any of our respective affiliates are permitted to directly or indirectly research, develop, manufacture or commercialize a compound that, as its primary mechanism of action, binds to and inhibits voltage-gated sodium channels Nav1.2 and Nav1.6, such compound referred to as a Select Nav Inhibitor.
We also granted to Neurocrine Biosciences a non-exclusive, non-royalty-bearing, sublicensable license to certain of our intellectual property rights for the screening of compounds for identification as a Select Nav Inhibitor (as defined below) and for the research of certain compounds otherwise expressly excluded from the Collaboration Agreement, or the Excluded Compounds. 9 During the term of the Collaboration Agreement, other than the Excluded Compounds and otherwise in accordance with the terms of the Collaboration Agreement, neither we nor any of our respective affiliates are permitted to directly or indirectly research, develop, manufacture or commercialize a compound that, as its primary mechanism of action, binds to and inhibits voltage-gated sodium channels Nav1.2 and Nav1.6, such compound referred to as a Select Nav Inhibitor.
Phase 1b: Data from a Phase 1b transcranial magnetic stimulation, or TMS, study – which was designed to assess XEN1101’s ability and potency to modulate cortical excitability – demonstrated activity in the target CNS tissue and helped inform dose selection for our Phase 2b clinical trial. This Phase 1b double-blind, placebo-controlled, randomized cross-over TMS study included 20 healthy male subjects.
In addition, data from a Phase 1b transcranial magnetic stimulation, or TMS, study – which was designed to assess azetukalner’s ability and potency to modulate cortical excitability – demonstrated activity in the target CNS tissue and helped inform dose selection for our Phase 2b clinical trial.
The FDA reviews the application to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with GMPs.
Once the submission is accepted for filing, the FDA begins an in-depth substantive review of the NDA. The FDA reviews the application to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with GMPs.
Upon the termination of the Collaboration Agreement for any reason, all licenses and other rights granted to Neurocrine Biosciences by us shall terminate, provided that if termination is solely with respect to one or more products or countries, then such termination will apply only to the terminated products or countries.
If Neurocrine Biosciences is entitled to terminate the Collaboration Agreement due to our uncured material breach, in lieu of termination, Neurocrine Biosciences may elect to reduce all subsequent payments owing from Neurocrine Biosciences to us by half. 10 Upon the termination of the Collaboration Agreement for any reason, all licenses and other rights granted to Neurocrine Biosciences by us shall terminate, provided that if termination is solely with respect to one or more products or countries, then such termination will apply only to the terminated products or countries.
Key components of our strategy include: • Leveraging our discovery capabilities – which were founded upon our understanding of the genetics of channelopathies combined with proprietary biology and medicinal chemistry assets and know-how – to identify product candidates for development, drug targets and/or new indications for our existing product candidates; • Advancing selected proprietary product candidates through clinical development; • Selectively establishing collaborations that allow us to potentially expand our internal capabilities and/or address broader commercial opportunities than may be possible independently; • Identifying opportunities to further expand our pipeline though indication expansion, acquisition, or in-licensing of external product candidates; and • Commercializing product candidates alone or in collaboration with others. 3 Our Pipeline Our Product Candidates XEN1101 XEN1101 is a novel, potent Kv7 potassium channel opener being developed for the treatment of epilepsy, major depressive disorder, or MDD, and potentially other neurological disorders.
Key components of our strategy include: • Leveraging our discovery capabilities – which were founded upon our understanding of the genetics of channelopathies combined with proprietary biology and medicinal chemistry assets and know-how – to identify product candidates for development; • Advancing selected proprietary product candidates through clinical development; • Selectively establishing collaborations that allow us to potentially expand our internal capabilities and/or address broader commercial opportunities than may be possible independently; • Identifying opportunities to further expand our pipeline though indication expansion, acquisition, or in-licensing of external product candidates; and • Commercializing product candidates alone or in collaboration with others. 3 Our Pipeline Our Product Candidates Azetukalner Azetukalner, a novel, highly potent, selective Kv7 potassium channel opener, represents the most advanced, clinically validated potassium channel modulator in late-stage clinical development for the treatment of multiple indications that include epilepsy, including focal onset seizures, or FOS, and primary generalized tonic-clonic seizures, or PGTCS, as well as neuropsychiatric disorders including major depressive disorder, or MDD, and bipolar depression, or BPD.
XEN1101 for Epilepsy (Primary Generalized Tonic-Clonic Seizures) Our Phase 3 X-ACKT clinical trial is intended to support potential regulatory submissions in an additional epilepsy indication of primary generalized tonic-clonic seizures, or PGTCS.
Primary Generalized Tonic-Clonic Seizures The Phase 3 X-ACKT clinical study continues to enroll patients and is intended to support potential regulatory submissions in an additional epilepsy indication of PGTCS.
These laws are enforced by various federal and state enforcement authorities, including but not limited to, the U.S. Department of Justice, and individual U.S. Attorney offices within the Department of Justice, the U.S.
These laws, some of which may apply only if a pharmaceutical manufacturer has an approved product, are enforced by various federal and state enforcement authorities, including but not limited to, the U.S. Department of Justice, and individual U.S. Attorney offices within the Department of Justice, the U.S.
Most products that are eligible for fast track designation are also likely to be considered appropriate to receive a priority review. 16 Under the provisions of the new Food and Drug Administration Safety and Innovation Act, or FDASIA, enacted by Congress in 2012, a sponsor can request designation of a drug candidate as a “breakthrough therapy,” typically by the end of the drug’s Phase II trials.
Under the provisions of the new Food and Drug Administration Safety and Innovation Act, or FDASIA, enacted by Congress in 2012, a sponsor can request designation of a drug candidate as a “breakthrough therapy,” typically by the end of the drug’s Phase II trials.
These multicenter, randomized, double-blind, placebo-controlled trials are evaluating the clinical efficacy, safety, and tolerability of 15 mg or 25 mg of XEN1101 administered with food as adjunctive treatment in approximately 360 patients per study with focal onset seizures, or FOS.
Designed closely after the Phase 2b X-TOLE clinical trial, the Phase 3 X-TOLE clinical trials are multicenter, randomized, double-blind, placebo-controlled studies evaluating the clinical efficacy, safety, and tolerability of 15 mg or 25 mg of azetukalner administered orally with food as adjunctive treatment in approximately 360 patients with FOS per study.
Drugs are subject to regulation under the Federal Food, Drug, and Cosmetic Act, or FD&C Act, and other federal, provincial, state, local and foreign statutes and regulations. The FD&C Act and corresponding regulations govern, among other things, the testing, manufacturing, safety, efficacy, labeling, packaging, storage, record keeping, distribution, import, export, reporting, advertising and other promotional practices involving drugs.
The FD&C Act and corresponding regulations govern, among other things, the testing, manufacturing, safety, efficacy, labeling, packaging, storage, record keeping, distribution, import, export, reporting, advertising and other promotional practices involving drugs.
We believe there is a need for new, more effective and tolerable treatments for FOS and PGTCS that have rapid onset of action, unique mechanisms important in polypharmacy, are easy to take (for example, once-daily), and durable. Based on our market research, we believe XEN1101 could offer a compelling value proposition to address FOS and PGTCS, if approved.
We believe there is a need for new, more effective and tolerable treatments for FOS and PGTCS that have rapid onset of action, unique mechanisms of action important in polypharmacy, and are easy to take (for example, once-daily and no dose titration).
Within 60 days following submission of the application, the FDA reviews the NDA to determine if it is substantially complete before the agency accepts it for filing. The FDA may refuse to file any marketing application that it deems incomplete or not properly reviewable at the time of submission and may request additional information, including additional clinical data.
The FDA may refuse to file any marketing application that it deems incomplete or not properly reviewable at the time of submission and may request additional information, including additional clinical data. In this event, the NDA must be resubmitted with the additional information. The resubmitted application also is subject to review before the FDA accepts it for filing.
We entered into additional SPAs in September 2021 and January 2022 with Neurocrine Biosciences pursuant to which we issued and sold 275,337 and 258,986, respectively, of our Shares to Neurocrine Biosciences in private placements for aggregate purchase prices of $5.5 million ($19.9755 per share) and $8.25 million ($31.855 per share), respectively.
Share Purchase Agreements In January 2022, pursuant to the Collaboration Agreement, we entered into a Share Purchase Agreement, or SPA, with Neurocrine Biosciences pursuant to which we issued and sold 258,986 of our common shares to Neurocrine Biosciences in private placements for aggregate purchase price of $8.25 million ($31.855 per share).
We also must comply with the FDA’s advertising and promotion requirements, such as those related to direct-to-consumer advertising, the prohibition on promoting products for uses or in patient populations that are not described in or are otherwise inconsistent with the product’s approved labeling (known as “off-label use”), and industry-sponsored scientific and educational activities.
Other post-approval requirements applicable to drug manufacturers, include reporting of GMP deviations that may affect the safety, efficacy or quality of a distributed product, record-keeping requirements, reporting of adverse effects, reporting updated safety and efficacy information, and complying with electronic record and signature requirements. 15 We also must comply with the FDA’s advertising and promotion requirements, such as those related to direct-to-consumer advertising, the prohibition on promoting products for uses or in patient populations that are not described in or are otherwise inconsistent with the product’s approved labeling (known as “off-label use”), and industry-sponsored scientific and educational activities.
In addition, the ongoing X-TOLE Phase 2b OLE, which has been extended from five years to seven years, continues to generate important long-term data for XEN1101. 4 Summary of XEN1101 Clinical Results in Epilepsy Phase 1: Phase 1 studies conducted in healthy subjects suggested that XEN1101 was generally well tolerated in the doses examined, and its pharmacokinetic profile supported a once-daily dosing schedule with food and without the need for titration, which has been utilized in all Phase 2 and Phase 3 trials.
Upon completion of the DBP in the X-ACKT study, eligible patients may enter an open-label extension, or OLE, study for up to three years. 4 Summary of Azetukalner Clinical Results in Epilepsy Phase 1: Phase 1 studies conducted in healthy subjects suggested that azetukalner was generally well tolerated in the doses examined, and its pharmacokinetic profile supported a once-daily dosing schedule with food and without the need for titration, which has been utilized in all Phase 2 and Phase 3 trials.
As of December 31, 2023, we owned, co-owned or licensed 16 U.S. issued patents and 56 patents in foreign jurisdictions (exclusive of European patent national validations), and over 370 pending patent applications. 11 With regard to XEN1101, as of December 31, 2023, we owned 4 U.S. issued patents, 29 issued patents in foreign jurisdictions (exclusive of European patent national validations) and over 200 pending patent applications.
As of December 31, 2024, we owned, co-owned or licensed 21 U.S. issued patents, 78 issued patents in foreign jurisdictions (exclusive of European patent national validations), and over 355 pending patent applications.
We will rely, and expect to continue to rely, on third parties for the production of clinical and commercial quantities of any products that we may commercialize. Manufacturers of our products will be required to comply with applicable requirements in the GMP regulations, including quality control and quality assurance and maintenance of records and documentation.
Manufacturers of our products will be required to comply with applicable requirements in the GMP regulations, including quality control and quality assurance and maintenance of records and documentation.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

116 edited+37 added−29 removed451 unchanged
Biggest changeWe expect to incur significant expenses and increasing operating losses for the foreseeable future as we: • continue our research and pre-clinical and clinical development of our product candidates; • conduct additional pre-clinical, clinical or other studies for our product candidates; • manufacture, label, serialize and distribute drug substance and drug product for clinical trials and commercialization; • seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical trials; • hire and retain additional personnel, such as clinical, quality assurance, regulatory, scientific, commercial and administrative personnel; • seek to identify and validate additional product candidates; • acquire or in-license other product candidates and technologies; • make milestone or other payments under our in-license or other agreements, including, without limitation, payments to 1st Order Pharmaceuticals, Inc. and other third parties; • maintain, protect and expand our intellectual property portfolio; • establish sales, marketing, distribution and other commercial infrastructure to commercialize any products for which we may obtain marketing approval; • create additional infrastructure and incur additional costs to support our operations and our product development and planned future commercialization efforts; and • experience any delays or encounter adverse issues with respect to any of the above.
Biggest changeWe expect to incur significant expenses and increasing operating losses for the foreseeable future as we: • seek marketing authorization for and prepare for the potential commercial launch of azetukalner; • invest to further develop azetukalner for our current and future indications; • advance additional product candidates into pre-clinical and clinical development; • seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical trials; • require the manufacture of larger quantities of our product candidates for clinical development and potential commercialization; • hire additional commercial, clinical, scientific, management and administrative personnel; • acquire or in-license other assets and technologies; • maintain, protect and expand our intellectual property portfolio; and • create additional infrastructure to support our operations and any future commercialization efforts.
Our ability to recognize revenue from successful collaborations may be impaired by multiple factors including: • a collaborator may shift its priorities and resources away from our programs due to a change in business strategies, or a merger, acquisition, sale or downsizing of its company or business unit; • a collaborator may cease development in therapeutic areas which are the subject of our strategic alliances; 52 • a collaborator may change the success criteria for a particular program or product candidate thereby delaying or ceasing development of such program or candidate; • a significant delay in initiation of certain development activities by a collaborator will also delay payment of milestones tied to such activities, thereby impacting our ability to fund our own activities; • a collaborator could develop a product that competes, either directly or indirectly, with our current or future products, if any; • a collaborator with commercialization obligations may not commit sufficient financial or human resources to the marketing, distribution or sale of a product; • a collaborator with manufacturing responsibilities may encounter regulatory, resource or quality issues and be unable to meet demand requirements; • a collaborator may exercise its rights under the agreement to terminate our collaboration; • a dispute may arise between us and a collaborator concerning the research or development of a product candidate, commercialization of a product or payment of royalties or milestone payments, any of which could result in a delay in milestones, royalty payments or termination of a program and possibly resulting in costly litigation or arbitration which may divert management attention and resources; • a collaborator may not adequately protect the intellectual property rights associated with a product or product candidate; • a collaborator may use our proprietary information or intellectual property in such a way as to invite litigation from a third-party; and • disruptions caused by man-made or natural disasters or public health pandemics or epidemics or other business interruptions.
Our ability to recognize revenue from successful collaborations may be impaired by multiple factors including: • a collaborator may shift its priorities and resources away from our programs due to a change in business strategies, or a merger, acquisition, sale or downsizing of its company or business unit; • a collaborator may cease development in therapeutic areas which are the subject of our strategic alliances; • a collaborator may change the success criteria for a particular program or product candidate thereby delaying or ceasing development of such program or candidate; • a significant delay in initiation of certain development activities by a collaborator will also delay payment of milestones tied to such activities, thereby impacting our ability to fund our own activities; • a collaborator could develop a product that competes, either directly or indirectly, with our current or future products, if any; • a collaborator with commercialization obligations may not commit sufficient financial or human resources to the marketing, distribution or sale of a product; • a collaborator with manufacturing responsibilities may encounter regulatory, resource or quality issues and be unable to meet demand requirements; • a collaborator may exercise its rights under the agreement to terminate our collaboration; • a dispute may arise between us and a collaborator concerning the research or development of a product candidate, commercialization of a product or payment of royalties or milestone payments, any of which could result in a delay in milestones, royalty payments or termination of a program and possibly resulting in costly litigation or arbitration which may divert management attention and resources; • a collaborator may not adequately protect the intellectual property rights associated with a product or product candidate; • a collaborator may use our proprietary information or intellectual property in such a way as to invite litigation from a third-party; and 52 • disruptions caused by man-made or natural disasters or public health pandemics or epidemics or other business interruptions.
Our reliance on third parties to manufacture our product candidates may increase the risk that we will not have sufficient quantities of our product candidates, raw materials, APIs or drug products when needed or at an acceptable cost.
Our reliance on third parties to manufacture our product candidates may increase the risk that we will not have sufficient quantities of our raw materials, APIs or drug products when needed or at an acceptable cost.
Any of these transactions could be material to our financial condition and operating results and expose us to many risks, including: • disruption in our relationships with collaborators or suppliers as a result of such a transaction; • unanticipated liabilities related to acquired companies; • difficulties integrating acquired personnel, technologies and operations into our existing business; • retention of key employees; • diversion of management time and focus from operating our business to pursuing strategic transactions and managing any such strategic alliances, joint ventures or acquisition integration challenges; • dilution to our shareholders if we issue equity in connection with such transactions; • increases in our expenses and reductions in our cash available for operations and other uses; and 36 • possible write-offs or impairment charges relating to acquired businesses.
Any of these transactions could be material to our financial condition and operating results and expose us to many risks, including: • disruption in our relationships with collaborators or suppliers as a result of such a transaction; • unanticipated liabilities related to acquired companies; • difficulties integrating acquired personnel, technologies and operations into our existing business; • retention of key employees; • diversion of management time and focus from operating our business to pursuing strategic transactions and managing any such strategic alliances, joint ventures or acquisition integration challenges; • dilution to our shareholders if we issue equity in connection with such transactions; • increases in our expenses and reductions in our cash available for operations and other uses; and • possible write-offs or impairment charges relating to acquired businesses.
If any of our existing collaboration agreements are terminated, or if we determine that entering into other product collaborations is in our best interest but we either fail to enter into, delay in entering into or fail to maintain such collaborations: • the development of certain of our current or future product candidates may be terminated or delayed; • our cash expenditures related to development or commercialization of any such product candidates would increase significantly and we may need to seek additional financing sooner than expected; 53 • we may be required to hire additional employees or otherwise develop expertise, such as clinical, regulatory, sales and marketing expertise, some of which we do not currently have; • we may delay commercialization or reduce the scope of any sales or marketing activities; • we will bear all of the risk related to the development or commercialization of any such product candidates; and • the competitiveness of any product that is commercialized could be reduced.
If any of our existing collaboration agreements are terminated, or if we determine that entering into other product collaborations is in our best interest but we either fail to enter into, delay in entering into or fail to maintain such collaborations: • the development of certain of our current or future product candidates may be terminated or delayed; • our cash expenditures related to development or commercialization of any such product candidates would increase significantly and we may need to seek additional financing sooner than expected; • we may be required to hire additional employees or otherwise develop expertise, such as clinical, regulatory, sales and marketing expertise, some of which we do not currently have; • we may delay commercialization or reduce the scope of any sales or marketing activities; • we will bear all of the risk related to the development or commercialization of any such product candidates; and • the competitiveness of any product that is commercialized could be reduced.
The following examples are by way of illustration only: • others may be able to make compounds that are similar to our product candidates or future products but that are not covered by the claims of the patents that we own, co-own or may in-license; • others may independently develop similar or alternative technologies without infringing our intellectual property rights; • patents that we own, co-own or may in-license may not provide us with any competitive advantages, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; • we may obtain patents for certain compounds many years before we obtain marketing approval for products containing such compounds, and because patents have a limited life, the term(s) may begin to run out prior to the commercial sale of the related product, the commercial value of our patents may be limited; • we might not have been the first to make or file upon the inventions covered by the patents or pending patent applications; • it is possible that our pending patent applications will not issue as patents; • we cannot predict the scope of protection of any patent issuing from our patent applications, including whether the patent applications that we own will result in patents with claims directed to our product candidates or future products or uses thereof in the United States or in foreign countries; • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • we may fail to develop additional proprietary technologies that are patentable and/or may fail to adequately protect such technologies; • the laws of certain foreign countries may not protect our intellectual property rights to the same extent as the laws of the U.S., or we may fail to apply for or obtain adequate intellectual property protection in all the jurisdictions in which we operate; and • the patents of others may have an adverse effect on our business, for example by preventing us from commercializing our future products.
The following examples are by way of illustration only: • others may be able to make compounds that are similar to our product candidates or future products but that are not covered by the claims of the patents that we own, co-own or may in-license; • others may independently develop similar or alternative technologies without infringing our intellectual property rights; • patents that we own, co-own or may in-license may not provide us with any competitive advantages, or may be held invalid or unenforceable as a result of legal challenges by our competitors; • we may obtain patents for certain compounds many years before we obtain marketing approval for products containing such compounds, and because patents have a limited life, the term(s) may begin to run out prior to the commercial sale of the related product, thereby limiting the commercial value of our patents; • we might not have been the first to make or file upon the inventions covered by the patents or pending patent applications; • it is possible that our pending patent applications will not issue as patents; • we cannot predict the scope of protection of any patent issuing from our patent applications, including whether the patent applications that we own will result in patents with claims directed to our product candidates or future products or uses thereof in the United States or in foreign countries; • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • we may fail to develop additional proprietary technologies that are patentable and/or may fail to adequately protect such technologies; • the laws of certain foreign countries may not protect our intellectual property rights to the same extent as the laws of the U.S., or we may fail to apply for or obtain adequate intellectual property protection in all the jurisdictions in which we operate; and • the patents of others may have an adverse effect on our business, for example by preventing us from commercializing our future products.
To execute on our business plan for the development of independent programs, we will need to successfully: • reach agreement with multiple regulatory agencies on clinical and pre-clinical studies required for registration; • execute our clinical development and manufacturing plans for later-stage product candidates; • obtain required regulatory approvals in each jurisdiction in which we will seek to commercialize products; • build and maintain appropriate pre-commercialization capabilities as well as commercial sales, distribution and marketing capabilities; • build and implement effective market access strategy and gain market acceptance for our future products, if any; and • manage our spending as costs and expenses increase due to clinical trials, regulatory approvals and commercialization activities.
To execute on our business plan for the development of independent programs, we will need to successfully: • reach agreement with multiple regulatory agencies on clinical and pre-clinical studies required for registration; • execute our clinical development and manufacturing plans for later-stage product candidates; 30 • obtain required regulatory approvals in each jurisdiction in which we will seek to commercialize products; • build and maintain appropriate pre-commercialization capabilities as well as commercial sales, distribution and marketing capabilities; • build and implement effective market access strategy and gain market acceptance for our future products, if any; and • manage our spending as costs and expenses increase due to clinical trials, regulatory approvals and commercialization activities.
For additional information, see “Risk Factors — We are subject to evolving global laws and regulations relating to privacy, data protection and information security, which may require us to incur substantial compliance costs, and any failure or perceived failure by us to comply with such laws and regulations may harm our business and operations.” 32 Various laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements.
For additional information, see “Risk Factors — We are subject to evolving global laws and regulations relating to privacy, data protection and information security, which may require us to incur substantial compliance costs, and any failure or perceived failure by us to comply with such laws and regulations may harm our business and operations.” Various laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements.
Our future capital requirements depend on many factors, including but not limited to: • the scope, progress, results and costs of researching and developing our current product candidates, as well as additional product candidates we may develop and pursue in the future; • the timing of, and the costs involved in, obtaining marketing approvals for our product candidates and any additional product candidates we may develop and pursue in the future; • the number of future product candidates that we may pursue and their development requirements; • if approved, the costs of commercialization activities for any product candidate that receives regulatory approval to the extent such costs are not the responsibility of an existing or future collaborator, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities; • subject to the receipt of regulatory approval, revenue, if any, received from commercial sales of our product candidates and any additional product candidates we may develop and pursue in the future; • whether our existing collaborations generate substantial milestone payments and, ultimately, royalties on future approved products for us; • our ability to maintain existing collaborations and to establish new collaborations, licensing or other arrangements and the financial terms of such arrangements; • the costs associated with any transactions to acquire or in-license other product candidates and technologies; • our headcount growth and associated costs as we expand our research and development efforts and initiate pre-commercial activities; • the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patents, including litigation costs and the outcome of such litigation; and 29 • the ongoing costs of operating as a public company.
Our future capital requirements depend on many factors, including but not limited to: • the scope, progress, results and costs of researching and developing our current product candidates, as well as additional product candidates we may develop and pursue in the future; • the timing of, and the costs involved in, obtaining marketing approvals for our product candidates and any additional product candidates we may develop and pursue in the future; • the number of future product candidates that we may pursue and their development requirements; • if approved, the costs of commercialization activities for any product candidate that receives regulatory approval to the extent such costs are not the responsibility of an existing or future collaborator, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities; • subject to the receipt of regulatory approval, revenue, if any, received from commercial sales of our product candidates and any additional product candidates we may develop and pursue in the future; • whether our existing collaborations generate substantial milestone payments and, ultimately, royalties on future approved products for us; • our ability to maintain existing collaborations and to establish new collaborations, licensing or other arrangements and the financial terms of such arrangements; • the costs associated with any transactions to acquire or in-license other product candidates and technologies; • our headcount growth and associated costs as we expand our research and development efforts and initiate pre-commercial and commercial activities; • the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patents, including litigation costs and the outcome of such litigation; and 28 • the ongoing costs of operating as a public company.
If Neurocrine Biosciences or other collaborators license or otherwise acquire rights to intellectual property controlled by a third party in various circumstances, for example, where a product could not be developed or commercialized in a country without the third-party intellectual property right or, where it is decided that it would be useful to acquire such third-party right to develop or commercialize the product, they are eligible under our collaboration agreements to decrease payments payable to us on a product-by product basis and, in certain cases, on a country-by-country basis.
If Neurocrine Biosciences or other collaborators license or otherwise acquire rights to intellectual property controlled by a third party in various circumstances, for example, where a product could not be developed or commercialized in a country without the third-party intellectual property rights or, where it is decided that it would be useful to acquire such third-party rights to develop or commercialize the product, they are eligible under our collaboration agreements to decrease payments payable to us on a product-by-product basis and, in certain cases, on a country-by-country basis.
Misconduct by those parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities to us that violates: • the regulations of the FDA, EMA and other foreign regulators, including those laws requiring the reporting of true, complete and accurate information to such authorities; • manufacturing standards; • insider trading laws; • data privacy, data protection and security; • federal and state healthcare fraud and abuse laws and regulations in the U.S. and abroad; and • laws that require the reporting of financial information or data accurately.
Misconduct by those parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities to us that violates: • the regulations of the FDA, EMA and other foreign regulators, including those laws requiring the reporting of true, complete and accurate information to such authorities; • manufacturing standards; • insider trading laws; • data privacy, data protection and security; • federal and state healthcare fraud and abuse laws and regulations in the U.S. and abroad; and 31 • laws that require the reporting of financial information or data accurately.
These uncertainties are enhanced where the diseases or disorders under study lack established clinical endpoints, validated measures of efficacy, as is often the case with disorders for which no drugs have been developed previously and where the product candidates target novel mechanisms. 39 Further, our product candidates may not be approved even if they achieve their primary endpoint in our Phase 3 clinical trials.
These uncertainties are enhanced where the diseases or disorders under study lack established clinical endpoints, validated measures of efficacy, as is often the case with disorders for which no drugs have been developed previously and where the product candidates target novel mechanisms. 39 Further, our product candidates may not be approved even if they achieve their primary endpoints in our Phase 3 clinical trials.
The future regulatory and commercial success of XEN1101 is subject to a number of risks, including: • successful patient enrollment in clinical trials and ultimate completion of clinical trials; • successful efficacy data from our clinical programs that support acceptable risk-benefit profiles of XEN1101 in the intended patient populations; • receipt and maintenance of marketing approvals from applicable regulatory authorities; • completing any post-marketing studies required by applicable regulatory authorities; • obtaining and maintaining patent and trade secret protection and regulatory exclusivity for XEN1101; • making arrangements with third-party manufacturers for both clinical and commercial supplies of XEN1101; 38 • establishing sales, marketing and distribution capabilities and commercial launch of XEN1101, if and when approved, whether alone or in collaboration with others; • successful commercial launch of XEN1101, if and when approved; • acceptance of XEN1101, if and when approved, by patients, the medical community and third-party payers; • obtaining and maintaining acceptable pricing, third-party insurance coverage and adequate reimbursement; • maintaining a continued acceptable safety profile of XEN1101 following approval; • effectively competing with other therapies; • enforcing and defending intellectual property rights and claims; and • raising sufficient funds to support regulatory approval and commercialization activities.
The future regulatory and commercial success of azetukalner is subject to a number of risks, including: • successful patient enrollment in clinical trials and ultimate completion of clinical trials; • safety and efficacy data from our clinical programs that support acceptable risk-benefit profiles of azetukalner in the intended patient populations; • receipt and maintenance of marketing approvals from applicable regulatory authorities; • completing any post-marketing studies required by applicable regulatory authorities; • obtaining and maintaining patent and trade secret protection and regulatory exclusivity for azetukalner; • making arrangements with third-party manufacturers for both clinical and commercial supplies of azetukalner; • establishing sales, marketing and distribution capabilities and commercial launch of azetukalner, if and when approved, whether alone or in collaboration with others; • successful commercial launch of azetukalner, if and when approved; • acceptance of azetukalner, if and when approved, by patients, the medical community and third-party payers; • obtaining and maintaining acceptable pricing, third-party insurance coverage and adequate reimbursement; • maintaining a continued acceptable safety profile of azetukalner following approval; • effectively competing with other therapies; 38 • enforcing and defending intellectual property rights and claims; and • raising sufficient funds to support regulatory approval and commercialization activities.
If additional rules regarding ESG matters are adopted or if investors continue to increase their focus on ESG matters, we could incur substantially higher costs in our efforts to comply and cannot be certain that our efforts will be viewed as adequate by regulators or by such investors. Item 1B. Unresolved Staff Comments None. 66
If additional rules regarding ESG matters are formally adopted or if investors continue to increase their focus on ESG matters, we could incur substantially higher costs in our efforts to comply and cannot be certain that our efforts will be viewed as adequate by regulators or by such investors. Item 1B. Unresolved Staff Comments None. 66
If we are unsuccessful in accomplishing these objectives, we will not be able to develop and commercialize any future product candidates independently and could fail to realize the potential advantages of doing so. 31 If we are not successful in discovering, developing and commercializing additional product candidates, our ability to expand our business and achieve our strategic objectives may be impaired.
If we are unsuccessful in accomplishing these objectives, we will not be able to develop and commercialize any future product candidates independently and could fail to realize the potential advantages of doing so. If we are not successful in discovering, developing and commercializing additional product candidates, our ability to expand our business and achieve our strategic objectives may be impaired.
Additionally, rights predicated solely upon civil liability provisions of U.S. federal securities laws or any other laws of the U.S. may not be enforceable in original actions, or actions to enforce judgments obtained in U.S. courts, brought in Canadian courts, including courts in the Province of British Columbia. 64 We are at risk of securities class action litigation.
Additionally, rights predicated solely upon civil liability provisions of U.S. federal securities laws or any other laws of the U.S. may not be enforceable in original actions, or actions to enforce judgments obtained in U.S. courts, brought in Canadian courts, including courts in the Province of British Columbia. We are at risk of securities class action litigation.
As federal and state governments implement additional healthcare cost containment measures, including measures to lower prescription drug pricing, we cannot be sure that our products, if approved, will be covered by private or public payers, and if covered, whether the reimbursement will be adequate or competitive with other marketed products.
As federal and state governments implement additional healthcare cost containment measures, including measures to lower prescription drug pricing, we cannot be sure that our products, if approved, will be covered by private or public payers, and if covered, that the reimbursement will be adequate or competitive with other marketed products.
In addition, any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our product candidates. We are subject to risks associated with currency fluctuations which could impact our results of operations .
In addition, any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our product candidates. 29 We are subject to risks associated with currency fluctuations which could impact our results of operations .
If we are unable to establish name recognition based on our trademarks, we may not be able to compete effectively, and our business may be adversely affected. Risks Related to Ownership of Our Common Shares The market price of our common shares may be volatile, and purchasers of our common shares could incur substantial losses.
If we are unable to establish name recognition based on our trademarks, we may not be able to compete effectively, and our business may be adversely affected. 62 Risks Related to Ownership of Our Common Shares The market price of our common shares may be volatile, and purchasers of our common shares could incur substantial losses.
There may be difficulties in scaling up to commercial quantities and formulation of our product candidates, and the costs of manufacturing could be prohibitive. 54 Further, the FDA, EMA and other foreign regulatory authorities require that our product candidates be manufactured according to cGMP and similar foreign standards.
There may be difficulties in scaling up to commercial quantities and formulation of our product candidates, and the costs of manufacturing could be prohibitive. Further, the FDA, EMA and other foreign regulatory authorities require that our product candidates be manufactured according to cGMP and similar foreign standards.
Our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyberattacks and other related breaches. 34 A variety of risks associated with international operations could materially harm our business.
Our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyberattacks and other related breaches. A variety of risks associated with international operations could materially harm our business.
A successful product liability claim or series of claims brought against us could cause the market price of our common shares to decline and, if judgments exceed our insurance coverage, could adversely affect our future results of operations and business. 47 Patients with certain of the diseases, or disorders, targeted by our product candidates are often already in severe and advanced stages of disease and have both known and unknown significant pre-existing and potentially life-threatening conditions.
A successful product liability claim or series of claims brought against us could cause the market price of our common shares to decline and, if judgments exceed our insurance coverage, could adversely affect our future results of operations and business. 46 Patients with certain of the diseases, or disorders, targeted by our product candidates are often already in severe and advanced stages of disease and have both known and unknown significant pre-existing and potentially life-threatening conditions.
Many of these risks are beyond our control, including the risks related to clinical development, the regulatory submission process, potential threats to our intellectual property rights and the manufacturing, marketing and sales efforts of any future collaborator.
Many of these risks are beyond our control, including the risks related to clinical development, the regulatory submission and approval process, potential threats to our intellectual property rights and the manufacturing, marketing and sales efforts of any future collaborator.
Restrictions under applicable healthcare and data privacy laws and regulations include the following, some of which will apply only if and when we have a marketed product: • the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid; • federal civil and criminal false claims laws, including the federal False Claims Act, which can be enforced through civil whistleblower, or qui tam actions, as well as civil monetary penalty laws can impose criminal and civil penalties, assessment, and exclusion from participation for various forms of fraud and abuse involving the federal healthcare programs, such as Medicare and Medicaid; • the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, as amended, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also establishes requirements related to the privacy, security, and transmission of individually identifiable health information which apply to many healthcare providers, physicians, and third-party payers with whom we interact; • the FDCA, which, among other things, strictly regulates drug product and medical device marketing, prohibits manufacturers from marketing such products for off-label use and regulates the distribution of samples; • federal laws that require pharmaceutical manufacturers to report certain calculated product prices to the government or provide certain discounts or rebates to government authorities or private entities, often as a condition of reimbursement under governmental healthcare programs; • the so-called federal "sunshine law" or Open Payments which requires manufacturers of drugs, devices, biologics, and medical supplies to report to the Centers for Medicare & Medicaid Services information related to payments and other transfers of value to teaching hospitals, physicians, and other healthcare practitioners, as well as ownership and investment interests held by physicians and their immediate family members; • federal and state consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payers, including private insurers; state and foreign laws that limit financial interactions between manufacturers and health care providers; require manufacturers to adopt certain compliance standards; require disclosure to the government and public of financial interactions; require disclosure of marketing expenditures or pricing information, regulate drug pricing and/or require the registration of pharmaceutical sales representatives;; and state and foreign laws governing the collection, export, privacy, use, protection and security of biological materials and health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts. 37 Efforts to ensure that our activities comply with applicable healthcare laws and regulations will involve substantial costs.
Restrictions under applicable healthcare and data privacy laws and regulations include the following, some of which will apply only if and when we have a marketed product: • the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid; • federal civil and criminal false claims laws, including the federal False Claims Act, which can be enforced through civil whistleblower, or qui tam actions, as well as civil monetary penalty laws can impose criminal and civil penalties, assessment, and exclusion from participation for various forms of fraud and abuse involving the federal healthcare programs, such as Medicare and Medicaid; • the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, as amended, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also establishes requirements related to the privacy, security, and transmission of individually identifiable health information which apply to many healthcare providers, physicians, and third-party payers with whom we interact; • the FDCA, which, among other things, strictly regulates drug product and medical device marketing, prohibits manufacturers from marketing such products for off-label use and regulates the distribution of samples; • federal laws that require pharmaceutical manufacturers to report certain calculated product prices to the government or provide certain discounts or rebates to government authorities or private entities, often as a condition of reimbursement under governmental healthcare programs; • the so-called federal "sunshine law" or Open Payments which requires manufacturers of drugs, devices, biologics, and medical supplies to report to the Centers for Medicare & Medicaid Services information related to payments and other transfers of value to teaching hospitals, physicians, and other healthcare practitioners, as well as ownership and investment interests held by physicians and their immediate family members; • federal and state consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payers, including private insurers; state and foreign laws that limit financial interactions between manufacturers and healthcare providers; require manufacturers to adopt certain compliance standards; require disclosure to the government and public of financial interactions; require disclosure of marketing expenditures or pricing information, regulate drug pricing and/or require the registration of pharmaceutical sales representatives; and state and foreign laws governing the collection, export, privacy, use, protection and security of biological materials and health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.
U.S. holders should consult their own tax advisors with respect to their particular circumstances. 35 A U.S. holder may avoid these adverse tax consequences by timely making a qualified electing fund election.
U.S. holders should consult their own tax advisors with respect to their particular circumstances. A U.S. holder may avoid these adverse tax consequences by timely making a qualified electing fund election.
Similarly, the current conflicts between Ukraine and Russia and in the Middle East, as well as recent failures in the global banking sector, have created volatility in the capital markets and are expected to have further global economic consequences.
The current conflicts between Ukraine and Russia and in the Middle East, as well as recent failures in the global banking sector, have created volatility in the capital markets and are expected to have further global economic consequences.
We likely will have little control over such third parties, and any of these third parties may fail to devote the necessary resources and attention to sell, market, and distribute our current or any future products effectively. 48 Even if we receive regulatory approval to commercialize any of our product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and delays.
We likely will have little control over such third parties, and any of these third parties may fail to devote the necessary resources and attention to sell, market, and distribute our current or any future products effectively. 47 Even if we receive regulatory approval to commercialize any of our product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and delays.
Actions by federal and state governments and health plans may put additional downward pressure on pharmaceutical pricing and healthcare costs, which could negatively impact coverage and reimbursement for our products if approved, our revenue, and our ability to compete with other marketed products and to recoup the costs of our research and development. 50 Additionally, net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or private payers and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the U.S.
Actions by federal and state governments and health plans may put additional downward pressure on pharmaceutical pricing and healthcare costs, which could negatively impact coverage and reimbursement for our products if approved, our revenue, and our ability to compete with other marketed products and to recoup the costs of our research and development. 49 Additionally, net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or demanded by private payers and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the U.S.
Pharmaceutical products approved for use in the U.S. may be listed as Schedule II, III, IV or V, with Schedule II substances considered to present the highest potential for abuse or dependence and Schedule V substances the lowest relative risk of abuse among such substances. 49 Scheduling determinations by the DEA are dependent on FDA approval of a substance or a specific formulation of a substance.
Pharmaceutical products approved for use in the U.S. may be listed as Schedule II, III, IV or V, with Schedule II substances considered to present the highest potential for abuse or dependence and Schedule V substances the lowest relative risk of abuse among such substances. 48 Scheduling determinations by the DEA are dependent on FDA approval of a substance or a specific formulation of a substance.
We do not own or operate manufacturing facilities for the production of clinical or commercial quantities of our product candidates, and we lack the resources and the capabilities to do so.
We do not own or operate manufacturing or testing facilities for the production of clinical or commercial quantities of our product candidates, and we lack the resources and the capabilities to do so.
For example, the U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, imposes specific requirements relating to the privacy, security, and transmission of individually identifiable health information that apply to most U.S. health care providers with which we interact, such as our U.S. clinical trial sites.
For example, the U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, imposes specific requirements relating to the privacy, security, and transmission of individually identifiable health information that apply to most U.S. healthcare providers with which we interact, such as our U.S. clinical trial sites.
To stop infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. In addition, in an infringement proceeding, a court may decide that a patent in suit is not valid or is not enforceable. In such case third parties may be able to use our technology without paying licensing fees or royalties.
To stop infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. In addition, in an infringement proceeding, a court may decide that a patent in suit is not valid or is not enforceable. In such cases, third parties may be able to use our technology without paying licensing fees or royalties.
Accordingly, even if we are able to obtain the requisite financing to continue to fund our development programs, we cannot ensure that we will successfully develop or commercialize XEN1101 for any indication. Our approach to drug discovery is unproven, and we do not know whether we will be able to develop any products of commercial value.
Accordingly, even if we are able to obtain the requisite financing to continue to fund our development programs, we cannot ensure that we will successfully develop or commercialize azetukalner for any indication. Our approach to drug discovery is unproven, and we do not know whether we will be able to develop any products of commercial value.
In addition to third-party manufacturers, we rely on other third parties to store, monitor, label, package and transport bulk drug substance and drug product.
In addition to third-party manufacturers, we rely on other third parties to store, test, monitor, label, package and transport bulk drug substance and drug product.
Third parties may also attempt to register trademarks utilizing the Xenon name on their products, and we may not be successful in preventing such usage. In addition, in the USPTO and in comparable patent officers in many foreign countries, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks.
Third parties may also attempt to register trademarks utilizing the Xenon name on their products, and we may not be successful in preventing such usage. In addition, in the USPTO and in comparable patent offices in many foreign countries, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks.
We, or our collaborators, may experience delays in completing our, or our collaborators’, clinical trials or pre-clinical studies, and initiating or completing additional clinical trials or pre-clinical studies, including as a result of regulators not allowing or delay in allowing clinical trials to proceed under an IND, or not approving or delaying approval for any clinical trial grant or similar approval we need to initiate a clinical trial.
We, or our collaborators, may experience delays in completing our, or our collaborators’, clinical trials or pre-clinical studies, and initiating or completing additional clinical trials or pre-clinical studies, including as a result of regulators not allowing or delay in allowing clinical trials to proceed under an IND, or not approving or delaying approval for any clinical trial application or similar approval we need to initiate a clinical trial.
As another example, the IRA drug price negotiation program has been challenged in litigation filed by various pharmaceutical manufacturers and industry groups. We are unable to predict the future course of federal or state healthcare legislation in the U.S.
As another example, the IRA drug price negotiation program has been challenged in litigation filed by various pharmaceutical manufacturers and industry groups. We are unable to predict the future course of federal or state healthcare or other reform legislation in the U.S.
For certain products, including XEN1101, and/or specific commercial markets, we evaluate commercial partners from time to time. In some cases, we may seek to retain the right to participate in the future development and commercialization of such products if we believe such involvement would advance our business.
For certain products, including azetukalner, and/or specific commercial markets, we evaluate commercial partners from time to time. In some cases, we may seek to retain the right to participate in the future development and commercialization of such products if we believe such involvement would advance our business.
Our prior losses, combined with expected future losses, have had and will continue to have an adverse effect on our shareholders’ equity and working capital. 28 We do not generate any revenue from product sales and may never become profitable .
Our prior losses, combined with expected future losses, have had and will continue to have an adverse effect on our shareholders’ equity and working capital. 27 We do not generate any revenue from product sales and may never become profitable .
If we or any collaborator are unable to develop, receive regulatory approval for, or successfully commercialize XEN1101 for our initial or potential additional indications, or if we experience delays as a result of any of these risks or otherwise, our business could be materially harmed.
If we or any collaborator are unable to develop, receive regulatory approval for, or successfully commercialize azetukalner for our initial or potential additional indications, or if we experience delays as a result of any of these risks or otherwise, our business could be materially harmed.
The implementation of the CTR also includes the implementation of the Clinical Trials Information System, or CTIS, a new clinical trial portal and database that will be maintained by the European Medicines Agency, or EMA, in collaboration with the European Commission and the EU Member States.
The implementation of the CTR also includes the implementation of the Clinical Trials Information System, or CTIS, a new clinical trial portal and database that will be maintained by the EMA in collaboration with the European Commission and the EU Member States.
Risks Related to the Discovery, Development and Commercialization of Our Product Candidates Our business substantially depends upon the successful development of XEN1101. If we are unable to obtain regulatory approval for, and successfully commercialize, XEN1101, our business may be materially harmed .
Risks Related to the Discovery, Development and Commercialization of Our Product Candidates Our business substantially depends upon the successful development of azetukalner. If we are unable to obtain regulatory approval for, and successfully commercialize, azetukalner, our business may be materially harmed .
For example, an investigator-sponsored Phase 2 proof-of-concept clinical trial examining XEN1101 in MDD and anhedonia is being conducted in partnership with academic collaborators at the Icahn School of Medicine at Mount Sinai.
For example, an investigator-sponsored Phase 2 proof-of-concept clinical trial examining azetukalner in MDD and anhedonia is being conducted in partnership with academic collaborators at the Icahn School of Medicine at Mount Sinai.
If we do not obtain protection under the Hatch-Waxman Act in the U.S. and similar foreign legislation by extending the patent terms for our product candidates, our business may be materially harmed.
If we do not obtain protection under the Hatch-Waxman Act in the U.S. and similar foreign legislation by extending the patent terms for patents covering our product candidates, our business may be materially harmed.
In addition, if one or more of our proprietary products were approved for the treatment of major depressive disorder, or MDD, we anticipate that they could potentially compete with other anti-depressant medications, or ADs.
If one or more of our proprietary products were approved for the treatment of major depressive disorder, or MDD, we anticipate that they could potentially compete with other anti-depressant medications, or ADs.
As product candidates are developed through pre-clinical to late-stage clinical trials towards approval and commercialization, it is common that various aspects of the development program, such as manufacturing methods and formulations, are altered along the way in an effort to optimize products, processes and results, to extend patent protection and/or to target different populations.
As product candidates are developed through pre-clinical to late-stage clinical trials towards approval and commercialization, it is common that various aspects of the development program, such as manufacturing methods and formulations, are altered along the way in an effort to optimize products, processes and results and/or to target different populations.
For example, in October 2021, we released topline data from our Phase 2b X-TOLE clinical trial of XEN1101 in adult patients with focal epilepsy. In addition, in November 2023, we released topline data from our Phase 2 X-NOVA clinical trial of XEN1101 in patients with MDD.
For example, in October 2021, we released topline data from our Phase 2b X-TOLE clinical trial of azetukalner in adult patients with focal epilepsy. In addition, in November 2023, we released topline data from our Phase 2 X-NOVA clinical trial of azetukalner in patients with MDD.
Complying with changes in regulatory requirements in different jurisdictions can result in additional costs, delay our clinical development plans, or expose us to greater liability if we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies governing clinical trials, our development plans, including our XEN1101 Phase 3 epilepsy clinical trials, may be impacted.
Complying with changes in regulatory requirements in different jurisdictions can result in additional costs, delay our clinical development plans, or expose us to greater liability if we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies governing clinical trials, our development plans, including our azetukalner Phase 3 clinical trials, may be impacted.
As we engage in significant cross-border and international activities, we will be subject to risks related to international operations, including: • different regulatory requirements for conducting clinical trials, registering and maintaining approval of, manufacturing and advertising drugs in foreign countries; • reduced protection for intellectual property rights in certain countries; • unexpected changes in tariffs, trade barriers and regulatory requirements; • economic weakness, including inflation, political instability or open conflict in particular foreign economies and markets; • differing and multiple payer reimbursement regimes, government payers or patient self-pay systems; • compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; • foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations of doing business in another country; • workforce uncertainty in countries where labor unrest is more common than in North America; • potential or actual violations of domestic and international anti-corruption laws, such as the U.S.
As we engage in significant cross-border and international activities, we will be subject to risks related to international operations, including: • different regulatory requirements for conducting clinical trials, registering and maintaining approval of, manufacturing and advertising drugs in foreign countries; • reduced protection for intellectual property rights in certain countries; • changes in tariffs, trade barriers and regulatory requirements including as a result of trade relations between Canada and the United States; • economic weakness, including inflation, political instability or open conflict in particular foreign economies and markets; • differing and multiple payer reimbursement regimes, government payers or patient self-pay systems; • compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; • foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations of doing business in another country; • workforce uncertainty in countries where labor unrest is more common than in North America; 34 • potential or actual violations of domestic and international anti-corruption laws, such as the U.S.
There can be no assurance that our ongoing XEN1101 Phase 3 epilepsy clinical trials or any other future Phase 3 clinical trials will demonstrate adequate efficacy and safety results and that we will be able to obtain regulatory approval of XEN1101. Any of the foregoing outcomes would materially and adversely impact our business, product candidate pipeline and future prospects.
There can be no assurance that our ongoing azetukalner Phase 3 clinical trials or any other future Phase 3 clinical trials will demonstrate adequate efficacy and safety results and that we will be able to obtain regulatory approval of azetukalner. Any of the foregoing outcomes would materially and adversely impact our business, product candidate pipeline and future prospects.
These and other health reform measures that are implemented may have a material adverse effect on our operations. 51 Healthcare reform efforts have been and may continue to be subject to scrutiny and legal challenge.
These and other health reform measures that are implemented may have a material adverse effect on our operations. 50 Healthcare reform efforts have been and may continue to be subject to scrutiny and legal challenge.
For example, administrative proceedings such as derivation proceedings, entitlement proceedings, ex parte reexamination, inter partes review, postgrant review, or opposition proceedings, provoked by third parties or initiated by the USPTO or any foreign patent authority may be used to challenge inventorship, ownership, claim scope, or validity of our patents or a patent of our licensor.
For example, administrative proceedings such as derivation proceedings, entitlement proceedings, ex parte reexamination, inter partes review, post-grant review, or opposition proceedings, provoked by third parties or initiated by the USPTO or any foreign patent authority may be used to challenge inventorship, ownership, claim scope, or validity of our patents or a patent of our licensor.
We currently have no products approved for commercial sale and are investing significant efforts and financial resources in the development of our clinical-stage product candidate, XEN1101 for the treatment of epilepsy, MDD and potentially other neurological disorders. Our future business success depends on the continued development and ultimate regulatory approval of XEN1101.
We currently have no products approved for commercial sale and are investing significant efforts and financial resources in the development of our clinical-stage product candidate, azetukalner for the treatment of epilepsy, MDD, BPD and potentially other neurological disorders. Our future business success depends on the continued development and ultimate regulatory approval of azetukalner.
Furthermore, even if we do receive regulatory approval for XEN1101 for any indication, any such approval may be subject to limitations on the indications or uses or patient populations for which we may market XEN1101.
Furthermore, even if we do receive regulatory approval for azetukalner for any indication, any such approval may be subject to limitations on the indications or uses or patient populations for which we may market azetukalner.
Gains realized by non-corporate U.S. holders on the sale of our common shares would be taxed as ordinary income, rather than as capital gain, and the preferential tax rate applicable to dividends received on our common shares would be lost. Interest charges would also be added to taxes on gains and dividends realized by all U.S. holders.
Gains realized by such U.S. holders on the sale of our common shares would be taxed as ordinary income, rather than as capital gain, and the preferential tax rate applicable to dividends received on our common shares would be lost. Interest charges would also be added to taxes on gains and dividends realized by all U.S. holders.
For example, while adverse events in our X-TOLE and X-NOVA clinical trials were generally mild or moderate in severity, there can be no guarantee that we will observe a similar tolerability profile of XEN1101 in our ongoing Phase 3 epilepsy or other clinical trials or in other future clinical trials.
For example, while adverse events in our X-TOLE and X-NOVA clinical trials were generally mild or moderate in severity, there can be no guarantee that we will observe a similar tolerability profile of azetukalner in our ongoing Phase 3 clinical trials or in other future clinical trials.
The market price for our common shares may be influenced by many factors, including the following: • announcements by us or our competitors of new products, product candidates or new uses for existing products, significant contracts, commercial relationships or capital commitments and the timing of these introductions or announcements; 62 • actions by any of our collaborators regarding our product candidates they are developing, including announcements regarding clinical or regulatory decisions or developments of our collaboration; • unanticipated serious safety concerns related to the use of any of our products and product candidates; • negative or inconclusive results from clinical trials of our product candidates, leading to a decision or requirement to conduct additional pre-clinical testing or clinical trials or resulting in a decision to terminate the continued development of a product candidate; • delays of clinical trials of our product candidates; • failure to obtain or delays in obtaining or maintaining product approvals or clearances from regulatory authorities; • adverse regulatory or reimbursement announcements; • announcements by us or our competitors of significant acquisitions, strategic collaborations, licenses, joint ventures or capital commitments; • the results of our efforts to discover or develop additional product candidates; • our dependence on third parties, including our collaborators, CROs, clinical trial sponsors and clinical investigators; • regulatory or legal developments in Canada, the U.S. or other countries; • developments or disputes concerning patent applications, issued patents or other proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • actual or anticipated quarterly variations in our financial results or those of our competitors; • sales of common shares by us, our insiders or our shareholders in the future, as well as the overall trading volume of our common shares; • changes in the structure of healthcare payment systems; • commencement of, or our involvement in, litigation; • the impact of pandemics, epidemics or other public health crises on our business and the macroeconomic environment; • general economic, industry and market conditions; • market conditions in the pharmaceutical and biotechnology sectors and other factors that may be unrelated to our operating performance or the operating performance of our competitors, including changes in market valuations of similar companies; and • the other factors described in this “Risk Factors” section.
The market price for our common shares may be influenced by many factors, including the following: • announcements by us or our competitors of new products, product candidates or new uses for existing products, significant contracts, commercial relationships or capital commitments and the timing of these introductions or announcements; • actions by any of our collaborators regarding our product candidates they are developing, including announcements regarding clinical or regulatory decisions or developments of our collaboration; • unanticipated serious safety concerns related to the use of any of our products and product candidates; • negative or inconclusive results from clinical trials of our product candidates, leading to a decision or requirement to conduct additional pre-clinical testing or clinical trials or resulting in a decision to terminate the continued development of a product candidate; • delays of clinical trials of our product candidates; • failure to obtain or delays in obtaining or maintaining product approvals or clearances from regulatory authorities; • adverse regulatory or reimbursement announcements; • announcements by us or our competitors of significant acquisitions, strategic collaborations, licenses, joint ventures or capital commitments; • the results of our efforts to discover or develop additional product candidates; • our dependence on third parties, including our collaborators, CROs, clinical trial sponsors and clinical investigators; • regulatory or legal developments in Canada, the U.S. or other countries; • developments or disputes concerning patent applications, issued patents or other proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • actual or anticipated quarterly variations in our financial results or those of our competitors; • sales of common shares by us, our insiders or our shareholders in the future, as well as the overall trading volume of our common shares; • changes in the structure of healthcare payment systems; • commencement of, or our involvement in, litigation; • the impact of pandemics, epidemics or other public health crises on our business and the macroeconomic environment; • general economic, industry and market conditions; • market conditions in the pharmaceutical and biotechnology sectors and other factors that may be unrelated to our operating performance or the operating performance of our competitors, including changes in market valuations of similar companies; and • the other factors described in this “Risk Factors” section. 63 In addition, the stock market in general, and Nasdaq and the biopharmaceutical industry in particular, have from time to time experienced volatility that often has been unrelated to the operating performance of the underlying companies.
Challenges in enrolling and retaining patients in our clinical trials, including in our XEN1101 Phase 3 epilepsy clinical trials, whether as a result of pandemics, geopolitical events, or for any other reasons, may further delay the trials or cause them to be discontinued.
Challenges in enrolling and retaining patients in our clinical trials, including in our azetukalner Phase 3 clinical trials, whether as a result of pandemics, geopolitical events, or for any other reasons, may further delay the trials or cause them to be discontinued.
In addition, any of these regulatory authorities may change its requirements for the approval of a product candidate even after reviewing and providing comments or advice on a protocol for a pivotal clinical trial that, if successful, would potentially form the basis for an application for approval by the FDA, EMA or another foreign regulatory authority.
In addition, any of these regulatory authorities may change its requirements or recommendations for the approval of a product candidate at any time in the future, even after reviewing and providing comments or advice on a protocol for a pivotal clinical trial that, if successful, would potentially form the basis for an application for approval by the FDA, EMA or another foreign regulatory authority.
For example, currently the rights relating to the patent portfolio for XEN901 (now known as NBI-921352), other selective Nav1.6 inhibitors and dual Nav1.2/1.6 inhibitors are exclusively licensed to Neurocrine Biosciences, and Neurocrine Biosciences has the first right to bring and control any action in connection with product infringement. 58 If any current or future collaborator with rights to file, prosecute, enforce and/or defend patents related to our product candidates or future products fails to appropriately prosecute and maintain patent protection for patents covering any of our product candidates, or if patents covering any of our product candidates or future products are asserted against infringers or defended against claims of invalidity or unenforceability in a manner which adversely affects such coverage, our ability to develop and commercialize any such product candidates or future products may be adversely affected and we may not be able to prevent competitors from making, using, importing, offering for sale, and/or selling competing products.
For example, currently the rights relating to the patent portfolio for certain selective Nav1.6 inhibitors and dual Nav1.2/1.6 inhibitors are exclusively licensed to Neurocrine Biosciences, and Neurocrine Biosciences has the first right to bring and control any action in connection with product infringement. 58 If any current or future collaborator with rights to file, prosecute, enforce and/or defend patents related to our product candidates or future products fails to appropriately prosecute and maintain patent protection for patents covering any of our product candidates, or if patents covering any of our product candidates or future products are asserted against infringers or defended against claims of invalidity or unenforceability in a manner which adversely affects such coverage, our ability to develop and commercialize any such product candidates or future products may be adversely affected and we may not be able to prevent competitors from making, using, importing, offering for sale, and/or selling competing products.
In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as the laws in the U.S.
In addition, the laws of some foreign countries may not protect intellectual property rights to the same extent as the laws in the U.S.
Our and our collaborators’ clinical product candidates, which include XEN1101 and NBI-921352 (being developed by our collaborator Neurocrine Biosciences), along with product candidates we expect to enter clinical development, which include our pre-clinical compounds, are in varying stages of development and will require substantial clinical development, testing and regulatory approval prior to commercialization.
Our and our collaborators’ clinical product candidates, which include azetukalner and NBI-921355 (being developed by our collaborator Neurocrine Biosciences), along with product candidates we expect to enter clinical development, which include our pre-clinical compounds, are in varying stages of development and will require substantial clinical development, testing and regulatory approval prior to commercialization.
Depending on the extent of these or any other studies required by FDA or another regulatory authority, approval of an NDA or equivalent filing may be significantly delayed or may require us to expend more resources than we have available.
Depending on the extent of these or any other studies required by the FDA or another regulatory authority, approval of an NDA or equivalent filing may be significantly delayed or we may be unable to obtain approval of an NDA or equivalent filing because such studies may require us to expend more resources than we have available.
Bribery Act, or of U.S. and international import, export and re-export control and sanctions laws and regulations, the likelihood of which may increase with an increase of operations in foreign jurisdictions, directly or indirectly through third parties (whose corrupt or other illegal conduct may subject us to liability), which may involve interactions with government agencies or government-affiliated hospitals, universities and other organizations, such as conducting clinical trials, selling our products, and obtaining necessary permits, licenses, patent registrations, and other regulatory approvals; • tighter restrictions on privacy and data protection, and more burdensome obligations associated with the collection, use and retention of data, including clinical data and genetic material, may apply in jurisdictions outside of North America; • production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; • business interruptions resulting from geopolitical actions, including war, civil and political unrest and terrorism, or natural disasters including earthquakes, typhoons, floods and fires; and • supply and other disruptions resulting from the impact of public health pandemics or epidemics on our strategic partners, third-party manufacturers, suppliers and other third parties upon which we rely.
Bribery Act, or of U.S. and international import, export and re-export control and sanctions laws and regulations, the likelihood of which may increase with an increase of operations in foreign jurisdictions, directly or indirectly through third parties (whose corrupt or other illegal conduct may subject us to liability), which may involve interactions with government agencies or government-affiliated hospitals, universities and other organizations, such as conducting clinical trials, selling our products, and obtaining necessary permits, licenses, patent registrations, and other regulatory approvals; • tighter restrictions on privacy and data protection, and more burdensome obligations associated with the collection, use and retention of data, including clinical data and genetic material, may apply in jurisdictions outside of North America; • production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; • business interruptions resulting from geopolitical actions, including war, civil and political unrest and terrorism, or natural disasters including earthquakes, typhoons, floods and fires; • supply and other disruptions resulting from the impact of public health pandemics or epidemics on our strategic partners, third-party manufacturers, suppliers and other third parties upon which we rely; and • business interruptions resulting from increased government scrutiny on the use of certain foreign biotechnology service providers due to national security concerns, including the potential for legislation that restricts or prohibits the use of such third-party service providers.
If we cannot maintain the confidentiality of our proprietary technology and other confidential information, then our ability to obtain patent protection or to protect our trade secret information would be jeopardized, which would adversely affect our competitive position.
If we cannot maintain the confidentiality of our proprietary technology and other confidential information, then our ability to protect our trade secret information would be jeopardized, which would adversely affect our competitive position.
We, or our collaborators, may also experience numerous unforeseen events during our clinical trials that could delay or prevent our, or our collaborators’, ability to complete development for a product candidate, or receive marketing approval or commercialize the product candidates we, or our collaborators, develop, including: • delay or failure in obtaining the necessary approvals from regulators or institutional review boards, or IRBs, in order to commence a clinical trial at a prospective trial site, or their suspension or termination of a clinical trial once commenced; • inability to reach agreement with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites, or the breach of such agreements; • we may experience challenges or delays in recruiting principal investigators or study sites to lead our clinical trials; • side effects or adverse events in study participants presenting an unacceptable safety risk; • failure of third-party contractors, such as CROs, or investigators to comply with regulatory requirements, including good clinical practices, or GCPs; • difficulty in having patients complete a trial, adhere to the trial protocol, or return for post-treatment follow-up; • the number of subjects or patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients may drop out of these clinical trials at a higher rate than we anticipate; • clinical sites deviating from trial protocol or dropping out of a trial; • we may have to amend clinical trial protocols submitted to regulatory authorities or conduct additional studies to reflect changes in regulatory requirements or guidance, which it may be required to resubmit to an IRB and regulatory authorities for re-examination; • challenges or delays with accessing certain species of animals to complete our pre-clinical studies; • problems with investigational medicinal product storage, stability and distribution; • our inability to manufacture, or obtain from third parties, adequate supply of drug substance or drug product sufficient to complete our pre-clinical studies and clinical trials, including supply chain issues resulting from any events affecting raw material supply or manufacturing capabilities abroad; • a requirement to undertake and complete additional pre-clinical studies to generate data required to initiate clinical development or to support the continued clinical development of a product candidate or submission of an NDA or equivalent; • unforeseen disruptions, caused by man-made or natural disasters, public health pandemics or epidemics, civil unrest or military conflict, or other business interruptions; and • governmental or regulatory delays and changes in regulatory requirements, policy and guidelines. 42 These risks and uncertainties could impact any of our, or our collaborators’, clinical programs and any of the clinical, regulatory or operational events described above could change our, or our collaborators’, planned clinical and regulatory activities.
We, or our collaborators, may also experience numerous unforeseen events during our clinical trials that could delay or prevent our, or our collaborators’, ability to complete development for a product candidate, or receive marketing approval or commercialize the product candidates we, or our collaborators, develop, including: • delay or failure in obtaining the necessary approvals from regulators or institutional review boards, or IRBs, in order to commence a clinical trial at a prospective trial site, or their suspension or termination of a clinical trial once commenced; • inability to reach agreement with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites, or the breach of such agreements; • we may experience challenges or delays in recruiting principal investigators or study sites to lead our clinical trials; • side effects or adverse events in study participants presenting an unacceptable safety risk; • failure of third-party contractors, such as CROs, or investigators to comply with regulatory requirements, including good clinical practices, or GCPs; • difficulty in having patients complete a trial, adhere to the trial protocol, or return for post-treatment follow-up; • the number of subjects or patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients may drop out of these clinical trials at a higher rate than we anticipate; • clinical sites deviating from trial protocol or dropping out of a trial; • we may have to amend clinical trial protocols submitted to regulatory authorities or conduct additional studies to reflect changes in regulatory requirements or guidance, which it may be required to resubmit to an IRB and regulatory authorities for re-examination; • challenges or delays with accessing certain species of animals to complete our pre-clinical studies; • problems with investigational medicinal product storage, stability and distribution; • our inability to manufacture, or obtain from third parties, adequate supply of drug substance or drug product sufficient to complete our pre-clinical studies and clinical trials, including supply chain issues resulting from any events affecting raw material supply or manufacturing capabilities abroad; • a requirement to undertake and complete additional pre-clinical studies to generate data required to initiate clinical development or to support the continued clinical development of a product candidate or submission of an NDA or equivalent; • unforeseen disruptions, caused by man-made or natural disasters, public health pandemics or epidemics, civil unrest or military conflict, or other business interruptions; • governmental or regulatory delays; and 42 • changes to the policies, regulations and guidelines of the FDA, EMA or other foreign regulators regarding development, approval, and marketing of biopharmaceutical products, including but not limited to, in the U.S., as a result of policies implemented by the new presidential administration that may, for example, render our clinical data insufficient for approval or restrict us from marketing our product candidates in the manner in which we anticipate.
In addition, there could be potential trademark infringement claims brought by owners of other registered trademarks that incorporate variations of our registered or unregistered trademarks.
In addition, there could be potential trademark infringement claims brought by owners of other registered trademarks that incorporate variations of or allegedly cause confusion with our registered or unregistered trademarks.
We will need to successfully enroll and complete our XEN1101 Phase 3 epilepsy clinical trials and any other future Phase 3 clinical trials.
We will need to successfully enroll and complete our azetukalner Phase 3 clinical trials and any other future Phase 3 clinical trials.
Beyond the ACA, there are ongoing and widespread health care reform efforts, a number of which have focused on regulation of prices or payment for drug products. Drug pricing and payment reform was a focus of the Trump Administration and has been a focus of the Biden Administration.
Beyond the ACA, there are ongoing and widespread healthcare reform efforts, a number of which have focused on regulation of prices or payment for drug products. Drug pricing and payment reform was a focus of the first Trump administration and the Biden administration.
Global credit and financial markets have at times experienced extreme disruptions, including in connection with the COVID-19 pandemic, characterized by increased market volatility, increased rates of inflation, declines in consumer confidence, declines in economic growth, increases in unemployment rates, and uncertainty about economic stability.
Global credit and financial markets have at times experienced extreme disruptions characterized by increased market volatility, increased rates of inflation, declines in consumer confidence, declines in economic growth, increases in unemployment rates, and uncertainty about economic stability.
In addition, we rely on our collaborators, either directly or through CMOs, to manufacture product candidates licensed to them or to work with CMOs to produce sufficient quantities of materials required for the manufacture of our product candidates for pre-clinical testing and clinical trials and intend to do so for the commercial manufacture of our products.
Our current strategy is to outsource all manufacturing of our product candidates to third parties. 53 In addition, we rely on our collaborators, either directly or through CMOs, to manufacture product candidates licensed to them or to work with CMOs to produce sufficient quantities of materials required for the manufacture of our product candidates for pre-clinical testing and clinical trials and intend to do so for the commercial manufacture of our products.
We had net losses of $182.4 million, $125.4 million and $78.9 million for the years ended December 31, 2023, 2022 and 2021, respectively, and an accumulated deficit of $665.1 million as of December 31, 2023, which were driven by expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations.
We had net losses of $234.3 million, $182.4 million and $125.4 million for the years ended December 31, 2024, 2023 and 2022, respectively, and an accumulated deficit of $899.5 million as of December 31, 2024, which were driven by expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations.
We have significant Canadian federal net operating loss carryforwards which are limited in life, Canadian federal investment tax credit carryforwards and provincial investment tax credit carryforwards which could expire unused and be unavailable to offset future income tax liabilities.
Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited. We have significant Canadian federal net operating loss carryforwards which are limited in life, Canadian federal investment tax credit carryforwards and provincial investment tax credit carryforwards which could expire unused and be unavailable to offset future income tax liabilities.
If we are unable to arrange for such third-party sources, or fail to do so on commercially reasonable terms, we may not be able to successfully supply sufficient product candidate or we may be delayed in doing so. Such failure or substantial delay could materially harm our business.
If we are unable to arrange for such third-party sources, or fail to do so on commercially reasonable terms, we may not be able to successfully supply sufficient product candidate or we may be delayed in doing so.
If coverage and reimbursement are not available or reimbursement is available only to limited levels, we, or our collaborators, may not be able to successfully commercialize any product candidate for which marketing approval is obtained. There is significant uncertainty related to third-party payer coverage and reimbursement of newly approved products.
If coverage and reimbursement are not available or are limited, we, or our collaborators, may not be able to successfully commercialize any product candidate for which marketing approval is obtained. There is significant uncertainty related to third-party payer coverage and reimbursement of newly approved products. Within the U.S., coverage and reimbursement varies from one third party payer to another.
Within the U.S., coverage and reimbursement varies from one third party payer to another. One third-party payer’s determination to provide coverage for a product candidate does not assure that other payers will also provide coverage for the product candidate. As a result, the coverage determination process is often time-consuming and costly.
One third-party payer’s determination to provide coverage for a product candidate does not assure that other payers will also provide coverage for the product candidate. As a result, the coverage determination process is often time-consuming and costly.
Any provision in our articles, by-laws, under the CBCA or under any applicable Canadian securities law that has the effect of delaying or deterring a change in control could limit the opportunity for our shareholders to receive a premium for their common shares, and could also affect the price that some investors are willing to pay for our common shares, thereby depressing the market price of our common shares.
Any provision in our articles, by-laws, under the CBCA or under any applicable Canadian securities law that has the effect of delaying or deterring a change in control could limit the opportunity for our shareholders to receive a premium for their common shares, and could also affect the price that some investors are willing to pay for our common shares, thereby depressing the market price of our common shares. 64 U.S. civil liabilities may not be enforceable against us, our directors, or our officers.
Certain foreign jurisdictions have enacted data localization laws and cross-border personal data transfer laws, which could make it more difficult to transfer information across jurisdictions, such as transferring or receiving personal data that originates in the European Union, or EU. Additional jurisdictions continue to enact and modify their data privacy laws, which increases the complexity of the data privacy landscape.
Certain foreign jurisdictions have enacted data localization laws and cross-border personal data transfer laws, which could make it more difficult to transfer information across jurisdictions, such as transferring or receiving personal data that originates in the European Union, or EU.
Generally, for any taxable year in which 75% or more of our gross income is passive income, or at least 50% of the average percentage of our assets (as determined under applicable Treasury Regulations, which may be determined in part by the market value of our common shares, which is subject to change) are held for the production of, or produce, passive income, we would be characterized as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes.
Generally, for any taxable year in which 75% or more of our gross income is passive income, or at least 50% of the quarterly average percentage of our assets (as determined under applicable Treasury Regulations) are held for the production of, or produce, passive income, we would be characterized as a PFIC, for U.S. federal income tax purposes.
If any third-party manufacturer of our product candidates is unable to increase the scale of its production of our product candidates, and/or increase the product yield of its manufacturing, then our costs to manufacture the product may increase and commercialization may be delayed.
Such failure or substantial delay could materially harm our business. 54 If any third-party manufacturer of our product candidates is unable to increase the scale of its production of our product candidates, and/or increase the product yield of its manufacturing, then our costs and time to manufacture the product may increase and commercialization may be delayed.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAt least annually, the SVP, IS, and the CFO provide a comprehensive report to the Audit Committee regarding cybersecurity risk assessments, emerging threats and changes to industry standards, and incident reports and remediation, if any. The SVP, IS, oversees processes for the regular monitoring of our information systems, including potential vulnerabilities.
Biggest changeAt least annually, the SVP, IS, and the CFO provide a comprehensive report to the Audit Committee regarding cybersecurity risk assessments, planned enhancements to our cyber security program , and incident reports and remediation, if any . The SVP, IS, oversees processes for the regular monitoring of our information systems, including potential vulnerabilities.
As such, we have implemented an information security program designed to assess, identify, and manage risks from cybersecurity threats. We perform risk assessments relating to cybersecurity and technology risks at least annually. Our cybersecurity risk management program has been developed based on industry standards, including those published by the National Institute of Standards and Technology (“NIST”).
As such, we have implemented an information security program designed to identify, assess, and manage risks from cybersecurity threats. We perform risk assessments relating to cybersecurity and technology risks at least annually. Our cybersecurity risk management program has been developed based on industry standards, including those published by the National Institute of Standards and Technology (“NIST”).
For a discussion of these risks, see “Item 1A—Risk Factors—Risk Related to Our Business and Industry—Our business and operations could suffer in the event of an actual or perceived information security incident such as a cybersecurity breach, system failure, or other compromise of our systems and/or information, including information held by a third-party contractor or vendor.”
For a discussion of these risks, see “Item 1A—Risk Factors—Risk Related to Our Business and Industry—Our business and operations could suffer in the event of an actual or perceived information security incident such as a cybersecurity breach, system failure, or other compromise of our systems and/or information, including information held by a third-party contractor or vendor.” 67
During the fiscal year ended December 31, 2023, we did not experience any material impact to our business, financial position or operations resulting from previously identified cyberattacks or other information security incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks or any future material breaches.
During the fiscal year ended December 31, 2024, we did not experience any material impact to our business, financial position or operations resulting from previously identified cyberattacks or other information security incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks or any future material breaches.
Management’s oversight is performed through an IT Steering Committee, a subset of executive management including our Chief Financial Officer, or CFO, and Chief Legal Officer, and relevant functional expertise, including our Senior Vice President, Information Systems, or SVP, IS.
Management’s oversight is performed through an IT Strategy Committee, a subset of executive management including our Chief Financial Officer, or CFO, and Chief Legal Officer, and relevant functional expertise, including our Senior Vice President, Information Systems, or SVP, IS.

Item 2. Properties

Properties — owned and leased real estate

8 edited+0 added−1 removed12 unchanged
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The information required by this item is incorporated by reference to our Proxy Statement for the 2024 Annual Meeting of Shareholders to be filed with the SEC within 120 days after the end of the fiscal year ended December 31, 2023.
Biggest changeNon-Resident of Canada Holders should consult their own tax advisors to determine their entitlement to relief under an applicable income tax treaty or convention. 69 Securities Authorized for Issuance Under Equity Compensation Plans The information required by this item is incorporated by reference to our Proxy Statement for the 2025 Annual Meeting of Shareholders to be filed with the SEC within 120 days after the end of the fiscal year ended December 31, 2024.
The comparisons in the graph are required by the SEC and are not intended to forecast or be indicative of the possible future performance of our common stock. The graph assumes that all dividends have been reinvested (to date, we have not declared any dividends). 69 Issuer Repurchases of Equity Securities None. Ite m 6. [Reserved] 70
The comparisons in the graph are required by the SEC and are not intended to forecast or be indicative of the possible future performance of our common stock. The graph assumes that all dividends have been reinvested (to date, we have not declared any dividends). Issuer Repurchases of Equity Securities None. Ite m 6. [Reserved] 70
Stock Performance Graph This performance graph shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference into any filing of Xenon Pharmaceuticals Inc. under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Stock Performance Graph This performance graph shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or incorporated by reference into any filing of Xenon Pharmaceuticals Inc. under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
The following graph shows a comparison of the total cumulative returns of an investment of $100 in cash from December 31, 2018 through December 31, 2023 in (i) our common shares, (ii) the Nasdaq Biotechnology Index, and (iii) the Nasdaq Composite Index.
The following graph shows a comparison of the total cumulative returns of an investment of $100 in cash from December 31, 2019 through December 31, 2024 in (i) our common shares, (ii) the Nasdaq Biotechnology Index, and (iii) the Nasdaq Composite Index.
We currently pay an aggregate of approximately $63,964 per month in base rent and the landlord holds a security deposit equal to approximately $187,627. 67 We believe that our existing facilities are adequate to meet our business requirements for the near-term and that additional space will be available on commercially reasonable terms, if required. Item 3 .
We currently pay an aggregate of approximately $69,234 per month in base rent, operating expense and insurance, and the landlord holds a security deposit equal to approximately $187,627. We believe that our existing facilities are adequate to meet our business requirements for the near-term and that additional space will be available on commercially reasonable terms, if required. Item 3 .
Holders As of February 26, 2024, there were approximately 82 holders of record of our common shares. The actual number of shareholders is greater than this number of record holders and includes shareholders who are beneficial owners but whose common shares are held in street name by brokers and other nominees.
Holders As of February 24, 2025, there were approximately 72 holders of record of our common shares. The actual number of shareholders is greater than this number of record holders and includes shareholders who are beneficial owners but whose common shares are held in street name by brokers and other nominees.
We currently pay an aggregate of approximately $145,353 per month in base rent, property tax, common area maintenance fees and management fees, and the landlord holds a security deposit equal to approximately $67,932. We also occupy approximately 17,057 square feet of office space in Needham, Massachusetts. The term of the lease expires in November 2027.
We currently pay an aggregate of approximately $138,154 per month in base rent, property tax, common area maintenance fees and management fees, and the landlord holds a security deposit equal to approximately $62,561. We also occupy approximately 17,057 square feet of office space in Needham, Massachusetts. The term of the lease expires in November 2027.
Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Market Information Our common shares have been traded on the Nasdaq Global Market since November 5, 2014 under the symbol “XENE.” On February 26, 2024, the last reported sale price of our common shares was $49.13 per share.
Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Market Information Our common shares have been traded on the Nasdaq Global Market since November 5, 2014 under the symbol “XENE.” On February 24, 2025, the last reported sale price of our common shares was $38.37 per share.
Removed
Non-Resident of Canada Holders should consult their own tax advisors to determine their entitlement to relief under an applicable income tax treaty or convention.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

53 edited+19 added−33 removed31 unchanged
Biggest changeWe amortize the fair value of stock options using the straight-line method over the vesting period of the options. 75 Results of Operations Comparison of Years Ended December 31, 2023, 2022 and 2021 The following table summarizes the results of our operations for the years ended December 31, 2023, 2022 and 2021 together with changes in those items (in thousands): Year Ended December 31, Change 2023 vs. 2022 Change 2022 vs. 2021 2023 2022 2021 Increase/(Decrease) Increase/(Decrease) Revenue $ — $ 9,434 $ 18,437 $ (9,434 ) $ (9,003 ) Research and development expenses 167,512 105,767 75,463 61,745 30,304 General and administrative expenses 46,542 32,810 21,967 13,732 10,843 Other: Interest income 27,620 8,713 466 18,907 8,247 Unrealized fair value gain (loss) on trading securities 3,550 (2,934 ) (719 ) 6,484 (2,215 ) Foreign exchange gain (loss) 199 (1,891 ) 358 2,090 (2,249 ) Loss before income taxes $ (182,685 ) $ (125,255 ) $ (78,888 ) $ (57,430 ) $ (46,367 ) Revenue Revenue decreased by $9.4 million in the year ended December 31, 2023 as compared to the same period in 2022.
Biggest changeChanges in any of these assumptions may materially affect the fair value of awards granted and the amount of stock-based compensation expense recognized. 75 Results of Operations Comparison of Years Ended December 31, 2024, 2023 and 2022 The following table summarizes the results of our operations for the years ended December 31, 2024, 2023 and 2022 together with changes in those items (in thousands): Year Ended December 31, Change 2024 vs. 2023 Change 2023 vs. 2022 2024 2023 2022 Increase/(Decrease) Increase/(Decrease) Revenue $ — $ — $ 9,434 $ — $ (9,434 ) Research and development expenses 210,394 167,512 105,767 42,882 61,745 General and administrative expenses 68,904 46,542 32,810 22,362 13,732 Other: Interest income 41,943 27,620 8,713 14,323 18,907 Unrealized fair value gain (loss) on trading securities — 3,550 (2,934 ) (3,550 ) 6,484 Foreign exchange gain (loss) (1,064 ) 199 (1,891 ) (1,263 ) 2,090 Loss before income taxes $ (238,419 ) $ (182,685 ) $ (125,255 ) $ (55,734 ) $ (57,430 ) Revenue We did not recognize any revenue in the years ended December 31, 2024 and 2023, as compared to revenue of $9.4 million for 2022.
Our future capital requirements are difficult to forecast and will depend on many factors, including: • the scope, progress, results and costs of researching and developing our current product candidates, as well as other additional product candidates we may develop and pursue in the future; • the timing of, and the costs involved in, obtaining marketing approvals for our product candidates and any other additional product candidates we may develop and pursue in the future; • the number of future product candidates that we may pursue and their development requirements; • if approved, the costs of commercialization activities for any product candidate that receives regulatory approval to the extent such costs are not the responsibility of an existing or future collaborator, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities; • subject to the receipt of regulatory approval, revenue, if any, received from commercial sales of our product candidates and any other additional product candidates we may develop and pursue in the future; • whether our existing collaborations generate substantial milestone payments and, ultimately, royalties on future approved products for us; 78 • our ability to maintain existing collaborations and to establish new collaborations, licensing or other arrangements and the financial terms of such agreements; • our headcount growth and associated costs as we expand our research and development and initiate pre-commercial and commercial activities; • the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patents, including litigation costs and the outcome of such litigation; and • the ongoing costs of operating as a public company.
Our future capital requirements are difficult to forecast and will depend on many factors, including: • the scope, progress, results and costs of researching and developing our current product candidates, as well as other additional product candidates we may develop and pursue in the future; • the timing of, and the costs involved in, obtaining marketing approvals for our product candidates and any other additional product candidates we may develop and pursue in the future; • the number of future product candidates that we may pursue and their development requirements; • if approved, the costs of commercialization activities for any product candidate that receives regulatory approval to the extent such costs are not the responsibility of an existing or future collaborator, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities; • subject to the receipt of regulatory approval, revenue, if any, received from commercial sales of our product candidates and any other additional product candidates we may develop and pursue in the future; • whether our existing collaborations generate substantial milestone payments and, ultimately, royalties on future approved products for us; • our ability to maintain existing collaborations and to establish new collaborations, licensing or other arrangements and the financial terms of such agreements; • our headcount growth and associated costs as we expand our research and development and initiate pre-commercial and commercial activities; 78 • the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patents, including litigation costs and the outcome of such litigation; and • the ongoing costs of operating as a public company.
Our primary sources of revenue are derived from non-refundable upfront payments, funding for research and development services, milestone payments, and royalties under license and collaboration agreements. In contracts where we have more than one performance obligation to provide our customer with goods or services, each performance obligation is evaluated to determine whether it is distinct.
Our primary sources of revenue are derived from non-refundable upfront payments, funding for research and development services, milestone payments, and royalties under license and collaboration agreements. 74 In contracts where we have more than one performance obligation to provide our customer with goods or services, each performance obligation is evaluated to determine whether it is distinct.
We may also generate revenue in the future from payments as a result of license or collaboration agreements for any of our product candidates or intellectual property, such as our license and collaboration agreement with Neurocrine Biosciences, or the Neurocrine Collaboration, described in “Business — Collaborations, Commercial and License Agreements” and “Note 11” of the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
We may also generate revenue in the future from payments as a result of license or collaboration agreements for any of our product candidates or intellectual property, such as our license and collaboration agreement with Neurocrine Biosciences, or the Neurocrine Collaboration, described in “Business — Collaborations, Commercial and License Agreements” and “Note 10” of the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Through December 31, 2023, we have paid $2.0 million based on progress against these milestones. Future potential payments to 1st Order include up to $6.0 million in regulatory milestones. There are no royalty obligations to 1st Order. We have operating leases for research laboratories and office space in Burnaby, British Columbia and office space in Needham, Massachusetts.
Through December 31, 2024, we have paid $2.0 million based on progress against these milestones. Future potential payments to 1st Order include up to $6.0 million in regulatory milestones. There are no royalty obligations to 1st Order. We have operating leases for research laboratories and office space in Burnaby, British Columbia and office space in Needham, Massachusetts.
We anticipate that our interest income will continue to fluctuate depending on our cash and investment balances and interest rates. Unrealized fair value gain (loss) on trading securities. Trading securities are recorded at fair value. Unrealized fair value gain (loss) on trading securities is related to changes in market pricing on the investments during the period.
We anticipate that our interest income will continue to fluctuate depending on our cash and investment balances and interest rates. Unrealized fair value gain (loss) on trading securities. Trading securities are recorded at fair value. Unrealized fair value gain (loss) on trading securities is related to changes in market pricing on the investments classified as trading securities during the period.
In each instance, the equity investment was measured at fair value on the date of issuance and the resulting premium with the cash payment, was recognized as revenue. Research and development services were recognized as revenue at fair market value as the services were rendered. The research collaboration was completed in June 2022.
The equity investment was measured at fair value on the date of issuance and the resulting premium with the cash payment, was recognized as revenue. Research and development services were recognized as revenue at fair market value as the services were rendered. The research collaboration was completed in June 2022.
Our historical prepaid and accrual estimates have not been materially different from the actual costs. Stock-based compensation: Stock-based compensation is a critical accounting estimate due to the magnitude of and the many assumptions that are required to calculate stock-based compensation expense. We grant stock options to employees, consultants, directors and officers pursuant to our stock option plans.
Our historical prepaid and accrual estimates have not been materially different from the actual costs. Stock-based compensation: Stock-based compensation is a critical accounting estimate due to the magnitude of and the many assumptions that are required to calculate stock-based compensation expense. We grant stock options to employees, consultants, directors and officers pursuant to our equity incentive plans.
Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in conformity with generally accepted accounting principles in the U.S., or U.S. GAAP.
Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in conformity with generally accepted accounting principles in the United States, or GAAP.
The terms of the leases expire in June 2032 and November 2027, respectively. Amounts related to future lease payments for operating lease obligations as of December 31, 2023 totaled $12.5 million, with $1.7 million expected to be paid within the next 12 months.
The terms of the leases expire in June 2032 and November 2027, respectively. Amounts related to future lease payments for operating lease obligations as of December 31, 2024 totaled $10.2 million, with $1.7 million expected to be paid within the next 12 months.
We cannot provide assurance as to the timing of future milestone or royalty payments under the Neurocrine Collaboration, or that we will receive any of these payments at all. 72 The following table is a summary of revenue recognized for the years ended December 31, 2023, 2022 and 2021 (in thousands): Year Ended December 31, 2023 2022 2021 Neurocrine Biosciences: Recognition of the transaction price $ — $ 372 $ 3,715 Research and development services — 1,938 6,452 Milestone payments — 7,124 5,270 Pacira BioSciences: Milestone payments — — 3,000 Total revenue $ — $ 9,434 $ 18,437 Pursuant to the terms of the Neurocrine Collaboration, we received an upfront cash payment of $30.0 million and a $20.0 million equity investment in our common shares in December 2019.
We cannot provide assurance as to the timing of future milestone or royalty payments under the Neurocrine Collaboration, or that we will receive any of these payments at all. 72 The following table is a summary of revenue recognized for the years ended December 31, 2024, 2023 and 2022 (in thousands): Year Ended December 31, 2024 2023 2022 Recognition of the transaction price $ — $ — $ 372 Research and development services — — 1,938 Milestone payments — — 7,124 Total revenue $ — $ — $ 9,434 Pursuant to the terms of the Neurocrine Collaboration, we received an upfront cash payment of $30.0 million and a $20.0 million equity investment in our common shares in December 2019.
Contractual Commitments In April 2017, we acquired XEN1101 (previously known as 1OP2198) from 1st Order Pharmaceuticals, Inc., or 1st Order, pursuant to an asset purchase agreement. In August 2020, we and 1st Order amended the asset purchase agreement to amend certain definitions in the agreement and to modify the payment schedule for certain milestones.
Contractual Commitments In April 2017, we acquired azetukalner from 1st Order Pharmaceuticals, Inc., or 1st Order, pursuant to an asset purchase agreement. In August 2020, we and 1st Order amended the asset purchase agreement to amend certain definitions in the agreement and to modify the payment schedule for certain milestones.
Research and development expenses consist of costs incurred in performing research and development activities, including: • personnel-related expenses, consisting of salaries, benefits and stock-based compensation for employees engaged in scientific research and development; • third-party expenses incurred in connection with the pre-clinical and clinical development of our product candidates, including under agreements with CROs; • third-party expenses relating to formulation, process development and manufacture of drug substance and drug product for use in our pre-clinical testing and clinical trials; • third-party acquisition, license and collaboration fees; • laboratory consumables; and • certain indirect costs incurred in support of overall research and development activities, including facilities, depreciation and information technology costs. 73 Project-specific expenses reflect costs directly attributable to our clinical development candidates for which we have incurred significant expenses.
Research and development expenses consist of costs incurred in performing research and development activities, including: • personnel-related expenses, consisting of salaries, benefits and stock-based compensation for employees engaged in scientific research and development; • third-party expenses incurred in connection with the pre-clinical and clinical development of our product candidates, including under agreements with CROs; • third-party expenses relating to formulation, process development and manufacture of drug substance and drug product for use in our pre-clinical testing, clinical trials and potential commercial supply; • third-party acquisition, license and collaboration fees; • laboratory consumables; and • certain indirect costs incurred in support of overall research and development activities, including facilities, depreciation and information technology costs.
We base estimates on our historical experience, known trends and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not apparent from other sources.
We base estimates on our historical experience, known trends and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Financing Activities For the year ended December 31, 2023, net cash provided by financing activities totaled $353.5 million, compared to $278.5 million for the same period in 2022. The increase was primarily related to net proceeds of $353.5 million in 2023 as compared to net proceeds of $277.8 million in 2022 from the issuance of common shares and pre-funded warrants.
The decrease was primarily related to net proceeds from the issuance of common shares of $12.1 million in 2024 as compared to net proceeds of $353.5 million in 2023 from the issuance of common shares and pre-funded warrants. For the year ended December 31, 2023, net cash provided by financing activities totaled $353.5 million, compared to $278.5 million in 2022.
Operating Expenses The following table summarizes our operating expenses for the years ended December 31, 2023, 2022 and 2021 (in thousands): Year Ended December 31, 2023 2022 2021 Research and development $ 167,512 $ 105,767 $ 75,463 General and administrative 46,542 32,810 21,967 Total operating expenses $ 214,054 $ 138,577 $ 97,430 Research and Development Expenses Research and development expenses represent costs incurred to conduct development of our proprietary product candidates and our drug discovery efforts, including any acquired or in-licensed product candidates or technology, and costs to support our partnered product candidates.
Operating Expenses The following table summarizes our operating expenses for the years ended December 31, 2024, 2023 and 2022 (in thousands): Year Ended December 31, 2024 2023 2022 Research and development $ 210,394 $ 167,512 $ 105,767 General and administrative 68,904 46,542 32,810 Total operating expenses $ 279,298 $ 214,054 $ 138,577 Research and Development Expenses Research and development expenses represent costs incurred to conduct development of our proprietary product candidates and our drug discovery efforts, including any acquired or in-licensed product candidates or technology, and costs to support any partnered product candidates.
The increase was primarily attributable to personnel-related costs due to increased headcount to support our expanding research and development activities and stock-based compensation expense due to an increase in the number of options granted at a higher fair value as well as higher professional and consulting fees.
Personnel-related costs increased by $9.4 million primarily due to higher headcount to support our expanding research and development activities as well as an increase in stock-based compensation expense due to an increase in the number of options granted at a higher fair value.
We expect to incur significant expenses and increasing operating losses for the foreseeable future as we continue our research and pre-clinical and clinical development of our product candidates; expand the scope of our studies for our current and prospective product candidates; initiate additional pre-clinical, clinical or other studies for our product candidates; manufacture drug supply and drug product for clinical trials and commercialization; seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical studies; hire and retain additional personnel; seek to identify, and validate additional product candidates; acquire or in-license other product candidates and technologies; make milestone or other payments under our in-license or other agreements, including, without limitation, payments to 1st Order Pharmaceuticals, Inc and other third parties; maintain, protect and expand our intellectual property portfolio; establish a sales, marketing, distribution and other commercial infrastructure to commercialize any products for which we may obtain marketing approval; create additional infrastructure and incur additional costs to support our operations and our product development and planned future commercialization efforts; and experience any delays or encounter issues with any of the above.
We expect to incur significant expenses and increasing operating losses for the foreseeable future as we prepare for the potential commercial launch of azetukalner; invest significantly to further develop azetukalner for our current and future indications; advance additional product candidates into pre-clinical and clinical development; seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical studies; manufacture larger quantities of our product candidates of clinical development and potential commercialization; hire additional commercial, clinical, scientific, management and administrative personnel; acquire or in-license other product candidates and technologies; make milestone or other payments under our in-license or other agreements, including, without limitation, payments to 1st Order Pharmaceuticals, Inc and other third parties; maintain, protect and expand our intellectual property portfolio; establish a sales, marketing, distribution and other commercial infrastructure to commercialize any products for which we may obtain marketing approval; create additional infrastructure and incur additional costs to support our operations and our product development and planned future commercialization efforts; and experience any delays or encounter issues with any of the above.
Other Income The following table summarizes our other income for the years ended December 31, 2023, 2022 and 2021 together with changes in those items (in thousands): Year Ended December 31, Change 2023 vs. 2022 Change 2022 vs. 2021 2023 2022 2021 Increase/(Decrease) Increase/(Decrease) Interest income $ 27,620 $ 8,713 $ 466 $ 18,907 $ 8,247 Unrealized fair value gain (loss) on trading securities 3,550 (2,934 ) (719 ) 6,484 (2,215 ) Foreign exchange gain (loss) 199 (1,891 ) 358 2,090 (2,249 ) Other income $ 31,369 $ 3,888 $ 105 $ 27,481 $ 3,783 Other income increased by $27.5 million in the year ended December 31, 2023 as compared to the same period in 2022.
Other Income The following table summarizes our other income for the years ended December 31, 2024, 2023 and 2022 together with changes in those items (in thousands): Year Ended December 31, Change 2024 vs. 2023 Change 2023 vs. 2022 2024 2023 2022 Increase/(Decrease) Increase/(Decrease) Interest income $ 41,943 $ 27,620 $ 8,713 $ 14,323 $ 18,907 Unrealized fair value gain (loss) on trading securities — 3,550 (2,934 ) (3,550 ) 6,484 Foreign exchange gain (loss) (1,064 ) 199 (1,891 ) (1,263 ) 2,090 Other income $ 40,879 $ 31,369 $ 3,888 $ 9,510 $ 27,481 Other income increased by $9.5 million for the year ended December 31, 2024 as compared to 2023.
The overall transaction price of the arrangement was measured and allocated to certain performance obligations and revenue was recognized as those performance obligations were completed.
The overall transaction price of the arrangement was measured and allocated to certain performance obligations and revenue was recognized as those performance obligations were completed. In January 2022, based on the U.S.
We anticipate that our operating expenses will increase substantially, particularly as we: • continue our research and pre-clinical and clinical development of our product candidates; • seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical trials; • require the manufacture of larger quantities of our product candidates for clinical development and potential commercialization; • attract, hire and retain skilled personnel; • acquire or in-license other assets and technologies; • maintain, protect and expand our intellectual property portfolio; and • create additional infrastructure to support our operations and any future commercialization efforts.
We anticipate that our operating expenses will increase substantially, particularly as we: • prepare for the potential commercial launch of azetukalner; • invest significantly to further develop azetukalner for our current and future indications; • advance additional product candidates into pre-clinical and clinical development; • seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical trials; • require the manufacture of larger quantities of our product candidates for clinical development and potential commercialization; • hire additional commercial, clinical, scientific, management and administrative personnel; • acquire or in-license other assets and technologies; • maintain, protect and expand our intellectual property portfolio; and • create additional infrastructure to support our operations and any future commercialization efforts.
The increase was primarily attributable to our XEN1101 program and personnel-related costs due to increased headcount to support late-stage development and stock-based compensation expense due to an increase in the number of options granted at a higher fair value.
Personnel-related costs increased by $14.3 million driven by an increase in headcount to support late-stage development and an increase in stock-based compensation expense due to an increase in the number of options granted at a higher fair value.
General and Administrative Expenses The following table summarizes general and administrative expenses for the years ended December 31, 2023, 2022 and 2021 together with changes in those items (in thousands): Year Ended December 31, Change 2023 vs. 2022 Change 2022 vs. 2021 2023 2022 2021 Increase/(Decrease) Increase/(Decrease) Personnel-related (including stock-based compensation) $ 32,166 $ 22,814 $ 14,123 $ 9,352 $ 8,691 Professional and consulting fees 8,760 5,189 4,367 3,571 822 Other 5,616 4,807 3,477 809 1,330 General and administrative expenses $ 46,542 $ 32,810 $ 21,967 $ 13,732 $ 10,843 General and administrative expenses increased by $13.7 million in the year ended December 31, 2023 as compared to the same period in 2022.
General and Administrative Expenses The following table summarizes general and administrative expenses for the years ended December 31, 2024, 2023 and 2022 together with changes in those items (in thousands): Year Ended December 31, Change 2024 vs. 2023 Change 2023 vs. 2022 2024 2023 2022 Increase/(Decrease) Increase/(Decrease) Personnel-related (including stock-based compensation) $ 48,247 $ 32,166 $ 22,814 $ 16,081 $ 9,352 Professional and consulting fees 14,127 8,760 5,189 5,367 3,571 Other 6,530 5,616 4,807 914 809 General and administrative expenses $ 68,904 $ 46,542 $ 32,810 $ 22,362 $ 13,732 General and administrative expenses increased by $22.4 million for the year ended December 31, 2024 as compared to 2023.
Our net losses were $182.4 million, $125.4 million, and $78.9 million for the years ended December 31, 2023, 2022, and 2021, respectively. As of December 31, 2023, we had an accumulated deficit of $665.1 million.
Our net losses were $234.3 million, $182.4 million, and $125.4 million for the years ended December 31, 2024, 2023, and 2022, respectively. As of December 31, 2024, we had an accumulated deficit of $899.5 million.
The increase was primarily attributable to personnel-related costs due to increased headcount to support our expanding research and development activities and stock-based compensation expense due to an increase in the number of options granted at a higher fair value as well as higher recruitment fees, insurance premiums, and higher professional and consulting fees.
Personnel-related costs increased by $16.1 million primarily due to higher headcount to support our expanding research and development activities and future potential commercialization as well as an increase in stock-based compensation expense due to an increase in the number of options granted at a higher fair value.
As of December 31, 2023, an aggregate of 855,685 common shares have been sold for proceeds of $29.5 million, net of commissions and transaction expenses, under the March 2022 ATM. Funding Requirements We have incurred significant operating losses since inception. As of December 31, 2023, we had an accumulated deficit of $665.1 million.
As of December 31, 2024, an aggregate of 310,000 common shares have been sold for proceeds of $12.1 million, net of commissions and transaction expenses. Funding Requirements We have incurred significant operating losses since inception. As of December 31, 2024, we had an accumulated deficit of $899.5 million.
The increase for XEN1101 is driven by ongoing site initiation and patient enrollment in our Phase 3 epilepsy clinical trials, increase in manufacturing activities to support current and future clinical trials and a potential NDA submission, as well as the completion of our X-NOVA Phase 2 MDD clinical trial.
Direct external costs related to azetukalner increased by $51.9 million primarily due to ongoing site initiation and patient enrollment in our Phase 3 epilepsy clinical trials, increase in manufacturing activities to support current and future clinical trials and a potential NDA submission, as well as the completion of our Phase 2 MDD clinical trial.
Related Party Transactions For a description of our related party transactions, see “Certain Relationships and Related Transactions, and Director Independence.” Outstanding Share Data As of February 26, 2024, we had 75,432,482 common shares issued and outstanding, outstanding pre-funded warrants to purchase an additional 2,173,081 common shares, outstanding stock options to purchase an additional 8,860,105 common shares and an outstanding warrant to purchase an additional 40,000 common shares.
Related Party Transactions For a description of our related party transactions, see “Certain Relationships and Related Transactions, and Director Independence.” Outstanding Share Data As of February 24, 2025, we had 76,542,811 common shares issued and outstanding, outstanding pre-funded warrants to purchase an additional 2,173,081 common shares, outstanding stock options to purchase an additional 10,364,025 common shares, outstanding performance share units convertible into 194,000 common shares and an outstanding warrant to purchase an additional 40,000 common shares.
The consideration allocated to each distinct performance obligation is recognized as revenue when control is transferred to our customer for the related goods or services. Consideration in exchange for research and development services performed by us on behalf of the licensee is recognized upon performance of such activities at rates consistent with prevailing market rates.
Consideration in exchange for research and development services performed by us on behalf of the licensee is recognized upon performance of such activities at rates consistent with prevailing market rates.
We entered into an “at-the-market” equity offering sales agreement in August 2020, amended as of March 2022, with Jefferies LLC, or Jefferies, and Stifel, Nicolaus & Company, Incorporated, or Stifel, pursuant to which we may sell our common shares from time to time.
We entered into an “at-the-market” equity offering sales agreement in August 2020, amended as of March 2022, with Jefferies LLC and Stifel, Nicolaus & Company, Incorporated, or the ATM Program, and a new prospectus supplement was filed with the SEC on August 9, 2024, pursuant to which we refreshed the ATM Program and may sell common shares having gross proceeds of up to $350.0 million, from time to time.
Therefore, we do not maintain financial information for our internal early-stage research and internal drug discovery programs on a project-specific basis. We expense all research and development costs as incurred.
Our personnel and infrastructure are typically deployed over multiple projects and are not directly linked to any individual internal early-stage research or drug discovery program. Therefore, we do not maintain financial information for our internal early-stage research and internal drug discovery programs on a project-specific basis. 73 We expense all research and development costs as incurred.
Until such time as we can generate substantial product revenue, if ever, we expect to finance our cash needs through a combination of collaboration agreements and equity or debt financings.
Except for any obligations of our collaborators to make milestone payments under our agreements with them, we do not have any committed external sources of capital. Until such time as we can generate substantial product revenue, if ever, we expect to finance our cash needs through a combination of collaboration agreements and equity or debt financings.
Net foreign exchange gains and losses consisted of gains and losses from the impact of foreign exchange fluctuations on our monetary assets and liabilities that are denominated in currencies other than the U.S. dollar (principally the Canadian dollar). We will continue to incur substantial expenses in Canadian dollars and will remain subject to risks associated with foreign currency fluctuations.
Foreign exchange gain (loss). Net foreign exchange gain (loss) consists of gains and losses from the impact of foreign exchange fluctuations on our monetary assets and liabilities that are denominated in currencies other than the U.S. dollar (principally the Canadian dollar).
This was partially offset by higher interest income and changes in operating assets and liabilities. Investing Activities For the year ended December 31, 2023, net cash used in investing activities totaled $117.2 million, compared to $296.0 million for the same period in 2022. The change was driven primarily by an increase in the redemption of marketable securities, net of purchases.
For the year ended December 31, 2023, net cash used in investing activities totaled $111.4 million, compared to $293.4 million in 2022. The change was driven primarily by an increase in the redemption of marketable securities, net of purchases.
The increase was primarily attributable to an $18.9 million increase in interest income driven by a higher balance of marketable securities and an increase in market yields on investments.
Other income increased by $27.5 million for the year ended December 31, 2023 as compared to 2022. Interest income increased by $18.9 million driven by a higher balance of marketable securities and an increase in market yields on investments.
We generally recognize revenue from non-refundable upfront payments over the estimated term of the performance obligation or period in which the underlying benefit is transferred to the customer. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.
The consideration allocated to each distinct performance obligation is recognized as revenue when control is transferred to our customer for the related goods or services. We generally recognize revenue from non-refundable upfront payments over the estimated term of the performance obligation or period in which the underlying benefit is transferred to our customer.
This was partially offset by an increase in the purchases of property, plant and equipment. 79 For the year ended December 31, 2022, net cash used in investing activities totaled $296.0 million, compared to $246.8 million for the same period in 2021. The change was driven primarily by an increase in purchases of marketable securities, net of redemptions.
Investing Activities For the year ended December 31, 2024, net cash provided by investing activities totaled $165.0 million, compared to net cash used of $111.4 million in 2023. The change was driven primarily by an increase in the redemption of marketable securities, net of purchases. In addition, there was a decrease in the purchases of property, plant and equipment.
Research and Development Expenses The following table summarizes research and development expenses for the years ended December 31, 2023, 2022 and 2021 together with changes in those items (in thousands): Year Ended December 31, Change 2023 vs. 2022 Change 2022 vs. 2021 2023 2022 2021 Increase/(Decrease) Increase/(Decrease) Direct external costs: XEN1101 $ 89,303 $ 37,367 $ 21,664 $ 51,936 $ 15,703 XEN496 5,152 14,765 13,017 (9,613 ) 1,748 Pre-clinical, discovery and other programs 15,552 12,711 13,342 2,841 (631 ) Indirect costs: Personnel-related (including stock-based compensation) 45,981 32,447 21,225 13,534 11,222 Facilities and other unallocated research and development expenses 11,524 8,477 6,215 3,047 2,262 Research and development expenses $ 167,512 $ 105,767 $ 75,463 $ 61,745 $ 30,304 76 Research and development expenses increased by $61.7 million in the year ended December 31, 2023 as compared to the same period in 2022.
Research and Development Expenses The following table summarizes research and development expenses for the years ended December 31, 2024, 2023 and 2022 together with changes in those items (in thousands): Year Ended December 31, Change 2024 vs. 2023 Change 2023 vs. 2022 2024 2023 2022 Increase/(Decrease) Increase/(Decrease) Direct external costs: Azetukalner $ 106,806 $ 89,303 $ 37,367 $ 17,503 $ 51,936 XEN496 — 5,152 14,765 (5,152 ) (9,613 ) Pre-clinical and discovery programs 21,546 15,552 12,711 5,994 2,841 Indirect costs: Personnel-related (including stock-based compensation) 70,810 47,945 33,650 22,865 14,295 Other unallocated expenses 11,232 9,560 7,274 1,672 2,286 Research and development expenses $ 210,394 $ 167,512 $ 105,767 $ 42,882 $ 61,745 Research and development expenses increased by $42.9 million for the year ended December 31, 2024 as compared to 2023.
All remaining research and development expenses are reflected in pre-clinical, discovery and other program expenses. At any given time, we have several active early-stage research and drug discovery programs. Our personnel and infrastructure are typically deployed over multiple projects and are not directly linked to any individual internal early-stage research or drug discovery program.
Project-specific expenses reflect costs directly attributable to our clinical development candidates for which we have incurred significant expenses. All remaining research and development expenses are reflected in pre-clinical, discovery and other program expenses. At any given time, we have several active early-stage research and drug discovery programs.
Since our initial public offering through December 31, 2023, we have raised aggregate net cash proceeds of more than $1.3 billion primarily from the issuance of equity securities, including net proceeds of approximately $324.0 million from the sale of common shares and pre-funded warrants in a public offering in November 2023.
Since our initial public offering through December 31, 2024, we have raised aggregate net cash proceeds of more than $1.4 billion primarily from the issuance of equity securities. As of December 31, 2024, we had cash and cash equivalents and marketable securities of $754.4 million .
The increase was primarily related to higher research and development and general and administrative expenses, and no revenue recognized in 2023. This was partially offset by higher interest income and changes in operating assets and liabilities.
For the year ended December 31, 2023, net cash used in operating activities totaled $151.1 million, compared to $101.0 million in 2022. The increase was primarily related to higher research and development and general and administrative expenses, and a decrease in revenue recognized, partially offset by higher interest income and changes in operating assets and liabilities.
Liquidity and Capital Resources Sources of Liquidity To date, we have financed our operations primarily through the sale of equity securities, funding received from collaboration and license agreements, and debt financing.
The unrealized fair value gain on trading securities increased by $6.5 million due to changes in market yields on trading securities, partially offset by a lower balance of trading securities. 77 Liquidity and Capital Resources Sources of Liquidity To date, we have financed our operations primarily through the sale of equity securities, funding received from collaboration and license agreements, and debt financing.
We did not recognize any revenue in the year ended December 31, 2023, as compared to revenue from collaboration agreements of $9.4 million and $18.4 million for the years ended December 31, 2022 and 2021, respectively. To date, we have not had any products approved for sale and have not generated any revenue from product sales.
We have funded our operations primarily through the sale of equity securities, funding received from our licensees and collaborators, and debt financing. We did not recognize any revenue in the years ended December 31, 2024 and 2023, as compared to revenue from collaboration agreements of $9.4 million for the year ended December 31, 2022.
For the year ended December 31, 2022, net cash provided by financing activities totaled $278.5 million, compared to $447.5 million for the same period in 2021. The decrease was primarily related to net proceeds of $277.8 million in 2022 as compared to net proceeds of $447.3 million in 2021 from the issuance of common shares and pre-funded warrants.
The increase was primarily related to net proceeds of $353.5 million in 2023 as compared to net proceeds of $277.8 million in 2022 from the issuance of common shares and pre-funded warrants.
Overview We are a neuroscience-focused biopharmaceutical company committed to discovering, developing, and commercializing innovative therapeutics to improve the lives of people living with neurological and psychiatric disorders. We are advancing a novel product pipeline to address areas of high unmet medical need, including epilepsy and depression.
Overview We are a neuroscience-focused biopharmaceutical company dedicated to discovering, developing, and delivering life-changing therapeutics. We are advancing an ion channel product portfolio to address areas of high unmet medical need, including epilepsy and depression.
Consideration associated with at-risk substantive performance milestones, including sales-based milestones, is recognized as revenue when we determine it is probable that a significant reversal of the cumulative revenue recognized will not occur. At the end of each subsequent reporting period, we re-evaluate the probability of achievement of such milestones, and if necessary, adjust our estimate of the overall transaction price.
Consideration associated with at-risk substantive performance milestones, including sales-based milestones, is recognized as revenue using the most likely amount method when it is probable that a significant reversal of the cumulative revenue recognized will not occur.
The increase was primarily attributable to our XEN1101 program as well as personnel-related costs due to increased headcount to support late-stage development and stock-based compensation expense due to an increase in the number of options granted at a higher fair value, partially offset by a decrease in spend on XEN496.
Personnel-related costs increased by $22.9 million driven by an increase in headcount to support late-stage development and an increase in stock-based compensation expense due to an increase in the number of options granted at a higher fair value. 76 Research and development expenses increased by $61.7 million for the year ended December 31, 2023 as compared to 2022.
For the year ended December 31, 2022, net cash used in operating activities totaled $98.4 million, compared to $69.5 million for the same period in 2021. The increase was primarily related to higher research and development and general and administrative expenses, and lower revenue recognized in connection with the Neurocrine Collaboration and the Pacira Agreement.
Operating Activities For the year ended December 31, 2024, net cash used in operating activities totaled $181.4 million, compared to $151.1 million in 2023. The increase was primarily related to higher research and development and general and administrative expenses, as well as changes in operating assets and liabilities, partially offset by higher interest income.
For additional information, see “Note 3” of the consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Revenue recognition: Revenue recognition is a critical accounting estimate due to the magnitude and nature of the revenues we receive.
The items in our financial statements requiring significant estimates and judgments are as follows: Revenue recognition: Revenue recognition is a critical accounting estimate due to the magnitude and nature of the revenues we receive.
The decrease was primarily due to the Neurocrine Collaboration; all performance obligations associated with the upfront payment were completed in March 2022, resulting in a decrease in revenue of $0.4 million and the research component of our collaboration was completed in June 2022, resulting in a decrease in research and development services revenue of $1.9 million.
Revenue recognized in 2022 was related to the Neurocrine Collaboration, including $0.4 million of the overall transaction price, $1.9 million in research and development services, and a $7.1 million milestone.
Cash Flows The following table shows a summary of our cash flows for the years ended December 31, 2023, 2022 and 2021 (in thousands): Year Ended December 31, 2023 2022 2021 Net cash used in operating activities $ (145,327 ) $ (98,430 ) $ (69,502 ) Net cash used in investing activities (117,170 ) (296,003 ) (246,770 ) Net cash provided by financing activities 353,522 278,471 447,543 Operating Activities For the year ended December 31, 2023, net cash used in operating activities totaled $145.3 million, compared to $98.4 million for the same period in 2022.
Cash Flows The following table shows a summary of our cash flows for the years ended December 31, 2024, 2023 and 2022 (in thousands): Year Ended December 31, 2024 2023 (1) 2022 (1) Net cash used in operating activities $ (181,389 ) $ (151,112 ) $ (101,028 ) Net cash provided by (used in) investing activities 165,000 (111,385 ) (293,405 ) Net cash provided by financing activities 12,130 353,522 278,471 (1) Amounts have been reclassified as described in Note 2 of our consolidated financial statements.
The increase was primarily attributable to an $8.2 million increase in interest income driven by a higher balance of marketable securities 77 and an increase in market yields on investments.
Interest income increased by $14.3 million driven by a higher average balance of marketable securities and higher average market yields on investments. The unrealized fair value gain on trading securities decreased by $3.6 million due to the fact that we did not hold any marketable securities classified as trading in 2024.
General and administrative expenses increased by $10.8 million in the year ended December 31, 2022 as compared to the same period in 2021.
Professional and consulting fees increased by $5.4 million primarily associated with legal services in support of our ongoing business operations and pre-commercial activities. General and administrative expenses increased by $13.7 million for the year ended December 31, 2023 as compared to 2022.
Removed
XEN1101 XEN1101 is a novel, potent Kv7 potassium channel opener being developed for the treatment of epilepsy, major depressive disorder, or MDD, and potentially other neurological disorders.
Added
Azetukalner Clinical Development Azetukalner, a novel, highly potent, selective Kv7 potassium channel opener, represents the most advanced, clinically validated potassium channel modulator in late-stage clinical development for the treatment of multiple indications that include epilepsy, including focal onset seizures, or FOS, and primary generalized tonic-clonic seizures, or PGTCS, as well as neuropsychiatric disorders including major depressive disorder, or MDD and bipolar depression, or BPD .
Removed
XEN1101 for Epilepsy (Focal Onset Seizures) Our XEN1101 Phase 3 epilepsy program includes two identical Phase 3 clinical trials, called X-TOLE2 and X-TOLE3, which are designed closely after the Phase 2b X-TOLE clinical trial.
Added
Epilepsy Programs • Phase 3 X-TOLE2/3 azetukalner clinical studies in FOS continue to advance, with the first topline data readout anticipated in the second half of 2025. • Phase 3 X-ACKT clinical study continues to enroll patients and is intended to support potential regulatory submissions in an additional epilepsy indication of PGTCS. • Building upon more than 700+ patient-years of data to date from the ongoing X-TOLE open-label extension, or OLE, study, we continue to generate long-term scientific evidence supporting azetukalner’s compelling efficacy and safety profile, with approximately one in three patients on drug for at least 36 months achieving seizure freedom for a period of one year or longer.
Removed
These multicenter, randomized, double-blind, placebo-controlled trials are evaluating the clinical efficacy, safety, and tolerability of 15 mg or 25 mg of XEN1101 administered once-daily with food as adjunctive treatment in approximately 360 patients per study with focal onset seizures, or FOS.
Added
Neuropsychiatric Program • X-NOVA2, the first of three planned Phase 3 clinical trials evaluating azetukalner in patients with MDD is currently enrolling patients, and X-NOVA3 is expected to initiate mid-year. • We recently announced plans for a Phase 3 BPD program with initiation of the first of two azetukalner clinical studies in bipolar I and bipolar II depression expected by mid-year.
Removed
The primary efficacy endpoint is the median percent change, or MPC, in monthly seizure frequency from baseline through the double-blind period, or DBP, of XEN1101 compared to placebo. We anticipate patient enrollment in X-TOLE2 will be completed in late 2024 to early 2025.
Added
Initiation of this program is based on a strong scientific rationale – supported by promising clinical data with azetukalner and the Kv7 mechanism in MDD and preclinical research examining the genetic links between BPD and Kv7 and evidence of Kv7 downregulation in BPD – as well as a large unmet medical need. • Patient enrollment in the investigator-sponsored Phase 2 proof-of-concept study of azetukalner in MDD led by Icahn School of Medicine at Mount Sinai is complete, and topline results are anticipated in the first half of 2025.
Removed
XEN1101 for Epilepsy (Primary Generalized Tonic-Clonic Seizures) Our Phase 3 X-ACKT clinical trial is intended to support potential regulatory submissions in an additional epilepsy indication of primary generalized tonic-clonic seizures, or PGTCS.
Added
Early-Stage Pipeline: Next Generation Ion Channel Modulators We continue to expand our portfolio by leveraging our extensive expertise to discover and develop potassium and sodium channel therapeutics, with the goal of filing multiple INDs, or equivalent, in 2025. • IND-enabling work is underway with multiple Kv7 development candidates.
Removed
This multicenter, randomized, double-blind, placebo-controlled study is evaluating the clinical efficacy, safety, and tolerability of 25 mg of XEN1101 administered once-daily with food as adjunctive treatment in approximately 160 patients with PGTCS. The primary efficacy endpoint is the MPC in monthly PGTCS frequency from baseline through the DBP of XEN1101 compared to placebo.
Added
Kv7 may have utility in a broad range of therapeutic indications including seizures, pain, and neuropsychiatric disorders, such as MDD and BPD. • IND-enabling work is underway with a lead Nav1.7 development candidate.
Removed
XEN1101 for Epilepsy (Open-Label Extension) Upon completion of the DBP in X-TOLE2, X-TOLE3, or X-ACKT, eligible patients may enter an open-label extension, or OLE, study for up to three years. In addition, the ongoing X-TOLE Phase 2b OLE has been extended from five to seven years and continues to generate important long-term data for XEN1101.
Added
Nav1.7 is an important pain-related target, based on strong human genetic validation, that may represent a new class of medicines without the limitations of opioids. • We expect a lead candidate within our Nav1.1 program will enter IND-enabling studies in 2025.
Removed
XEN1101 for Major Depressive Disorder In November 2023, we reported promising topline results from the Phase 2 proof-of-concept X-NOVA clinical trial, which evaluated the clinical efficacy, safety, and tolerability of 10 mg and 20 mg of XEN1101 administered once-daily with food in 168 patients with moderate to severe MDD.
Added
Pre-clinical data suggests that targeting Nav1.1 could potentially address the underlying cause and symptoms of Dravet Syndrome 71 Partnered Program • As part of our ongoing collaboration with Neurocrine Biosciences to develop treatments for epilepsy, NBI-921355, a Nav1.2 and Nav1.6 sodium channel inhibitor in development for the potential treatment for certain types of epilepsy, has progressed into a Phase 1 clinical study in healthy adult participants, triggering an anticipated $7.5 million milestone payment to Xenon.
Removed
The primary endpoint of the study was a change in the Montgomery-Åsberg Depression Rating Scale, or MADRS, at week 6. A clear dose response and a clinically meaningful, but not statistically significant, 3.04 difference between placebo and the XEN1101 20 mg group (p=0.135) was observed.
Added
To date, we have not had any products approved for sale and have not generated any revenue from product sales.
Removed
Statistical significance was achieved on other secondary efficacy endpoints, including the Hamilton Depression Rating Scale, or HAM-D17; the Snaith-Hamilton Pleasure Scale, or SHAPS, measuring anhedonia; and MADRS at week 1, demonstrating early onset of efficacy. XEN1101 was generally well tolerated with similar rates of overall adverse events, as well as similar rates of discontinuation, reported across all treatment arms.
Added
We will continue to incur substantial expenses in Canadian dollars and will remain subject to risks associated with foreign currency fluctuations.
Removed
No serious adverse events were reported in the two XEN1101 treatment groups, XEN1101 was not associated with notable weight gain and participants did not report any notable sexual dysfunction. We are actively planning for late-stage clinical development of XEN1101 in MDD and expect to initiate the Phase 3 clinical program in 2024.
Added
If non-refundable license fees have value to the customer on a standalone basis, separate from the undelivered performance obligations, they are recognized upon delivery. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.
Removed
We are also evaluating other potential indications for the future development of XEN1101. In addition, we are collaborating with the Icahn School of Medicine at Mount Sinai to support an ongoing investigator-sponsored Phase 2 proof-of-concept, randomized, parallel-arm, placebo-controlled multi-site study of XEN1101 for the treatment of MDD in approximately 60 subjects.
Added
At the end of each subsequent reporting period, we re-evaluate the probability of achievement of such milestones, and if necessary, adjust the estimate of the overall transaction price.
Removed
See “Recent Developments” for additional information about topline X-NOVA results. 71 Other Pipeline Opportunities We continue to leverage our extensive ion channel expertise and drug discovery capabilities to identify validated drug targets and develop new product candidates. The near-term focus is on internal development candidates targeting Kv7, Nav1.1 and Nav1.7.
Added
We amortize the fair value of stock options using the straight-line method over the vesting period of the options. We also grant performance share unit awards (“PSUs”) to certain employees and officers pursuant to our equity incentive plans. The grant date fair value of PSUs is determined based on the closing market price of our common shares.
Removed
Partnered Program: NBI-921352 We have an ongoing collaboration with Neurocrine Biosciences to develop treatments for epilepsy. Neurocrine Biosciences has an exclusive license to XEN901, now known as NBI-921352, a selective Nav1.6 sodium channel inhibitor.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA 100 basis point, or 1%, unfavorable change in interest rates would have resulted in approximately a $5.7 million decrease in the fair value of our marketable securities as of December 31, 2023. We do not enter into investments for speculative purposes and have not used any derivative financial instruments to manage interest rate exposure.
Biggest changeA 100 basis point, or 1%, unfavorable change in interest rates would have resulted in approximately a $4.0 million decrease in the fair value of our marketable securities as of December 31, 2024. We do not enter into investments for speculative purposes and have not used any derivative financial instruments to manage interest rate exposure. 80
Interest rate sensitivity As of December 31, 2023, we had cash and cash equivalents and marketable securities of $930.9 million. Our interest rate sensitivity is primarily attributable to our cash and cash equivalents and marketable securities.
Interest rate sensitivity As of December 31, 2024, we had cash and cash equivalents and marketable securities of $754.4 million. Our interest rate sensitivity is primarily attributable to our cash and cash equivalents and marketable securities.
Foreign currency risk As of December 31, 2023, we had U.S. dollar denominated cash and cash equivalents and marketable securities of $907.1 million and Canadian dollar denominated cash and cash equivalents and marketable securities of CAD$31.5 million.
Foreign currency risk As of December 31, 2024, we had U.S. dollar denominated cash and cash equivalents and marketable securities of $685.7 million and Canadian dollar denominated cash and cash equivalents and marketable securities of CAD$98.7 million.
Removed
Inflation risk Inflation may generally affect us by increasing our cost of labor and research and development expenses.
Removed
While we have experienced increased operating expenses in recent periods, which we believe are due in part to the recent growth in inflation, we do not believe that inflation has had a material effect on our business, financial condition or results of operations during the year ended December 31, 2023; however, operating expenses may continue to increase in future periods due to inflation. 80

Other XENE 10-K year-over-year comparisons