Xeris Biopharma Holdings, Inc. — Q1 2024 Form 10-Q
Reporting period: Three months ended March 31, 2024. Xeris is a commercial-stage biopharmaceutical company with three marketed products: Gvoke, Recorlev and Keveyis. It also develops products using its XeriSol and XeriJect formulation platforms.
Financial performance
| Metric | Q1 2024 | Q1 2023 |
|---|---|---|
| Total revenue | $40.6 million | $33.2 million |
| Product revenue, net | $40.3 million | $32.3 million |
| Operating loss | $14.2 million | $13.3 million |
| Net loss | $19.0 million | $16.8 million |
| Net loss per share, basic and diluted | $0.14 | $0.12 |
| Net cash used in operating activities | $20.3 million | $26.1 million |
- Product revenue rose 24.8%. Gvoke revenue increased 10.3% to $16.6 million; Keveyis increased 2.6% to $13.1 million; and Recorlev increased 136.7% to $10.6 million.
- Royalty, contract and other revenue fell to $0.4 million from $0.9 million. Cost of goods sold was $6.0 million. Research and development expense increased 61.7% to $7.8 million, and selling, general and administrative expense increased 14.2% to $38.4 million.
- Q1 included $2.7 million of debt-refinancing costs and $7.0 million of interest expense. A $3.4 million gain from remeasurement of contingent value rights (CVRs) partly offset other expenses.
Financial position and liquidity
- At March 31, 2024, cash and cash equivalents were $62.7 million and short-term investments were $24.7 million. Current assets were $173.3 million versus current liabilities of $73.1 million.
- Long-term debt, net of issuance costs, was $229.7 million; stated principal payments totaled approximately $248.8 million. The March refinancing replaced the prior Hayfin facility with $200 million of term loans and made an additional $15.2 million available solely to redeem the 2025 convertible notes.
- The new loans bear a floating rate based on SOFR plus a stated spread; the company reported an effective interest rate of approximately 11.4%. The loans are secured by substantially all company assets, subject to exceptions, and include covenants and potential earlier maturity conditions tied to the convertible notes.
- Cash, cash equivalents and restricted cash decreased by $4.8 million during the quarter. Investing activities used $19.7 million, primarily for short-term investments; financing activities provided $35.2 million, mainly reflecting the refinancing.
- Stockholders’ deficit was $9.2 million. The company issued 7.5 million shares to settle a CVR milestone obligation; common shares outstanding were 148.2 million at quarter-end.
Changes, outlook and risks
- Revenue growth was led by Recorlev, reflecting more patients on therapy; Gvoke growth reflected prescription growth, partly offset by channel inventory changes. Keveyis growth primarily reflected higher net pricing, partly offset by slightly lower patient demand.
- Management expects continued net losses for at least the next 12 months, but believes existing working capital and current operating plans can fund operations and capital expenditures for at least 12 months from issuance of the statements. No specific revenue or earnings guidance is provided.
- Management plans to continue commercial investment in its three products and development work, particularly XP-8121, a once-weekly subcutaneous levothyroxine candidate. Its Phase 2 study was fully enrolled by December 2023 and was expected to be completed in the first half of 2024.
- Key risks include ongoing losses and possible need for additional financing; financing may not be available on acceptable terms. Four customers accounted for 96% of gross product revenue and 98% of net receivables, creating customer concentration exposure. The company also depends on successful commercialization, product acceptance, clinical development and intellectual-property protection.
- The 2023 Keveyis CVR milestone was achieved and settled with shares; the 2023 Recorlev milestone was not achieved. A separate 2024 Recorlev milestone depends on reaching $80 million in 2024 net revenue. Management reported no material legal proceedings or material changes to the risk factors in its prior annual report. Disclosure controls were judged effective.
Investor verification points
- Track whether product-level growth—especially Recorlev—continues, and assess net sales against channel inventory and rebate/return estimates.
- Review cash burn and liquidity alongside the new facility’s floating-rate costs, collateral, covenants and conditional maturity provisions.
- Verify XP-8121 Phase 2 completion and subsequent development plans; the filing does not provide a specific later-stage timeline.
- Assess the potential dilution from equity awards and CVR settlement: 50.0 million potentially dilutive securities were excluded from diluted EPS as anti-dilutive at quarter-end.
- Monitor customer concentration and the outcome of the 2024 Recorlev CVR milestone.