XOMA Royalty plays a unique role in helping biotech companies achieve their goal of improving human health.
We do this by acquiring the economic rights to potential milestone and royalty payments associated with pre-commercial clinical candidates and commercial therapies. In return the seller receives non-dilutive, non-recourse funding to advance their internal drug candidate(s).
Our Approach
There is so much promise in the biotech industry. Once-fatal diseases now are manageable medical conditions thanks to scientific advances. Many of us have been impacted by a new therapy that started in a biotech company.
For investors, biotech represents the potential for big rewards, yet requires taking risks and investing significant capital. We mitigate single-asset binary risk by taking a portfolio approach, building a portfolio of milestone and royalty rights to therapeutic assets that other companies are developing across multiple therapeutic indications and stages of clinical development.
In 2017 we made the strategic decision to transform the Company from XOMA, a traditional biotechnology company, into XOMA Royalty, a biotech royalty aggregator.
Over the course of our history, we had licensed antibody assets and technologies to pharmaceutical and biotech companies, building a sizeable portfolio of potential royalty and milestone payments. Through our experience, we realized the royalty monetization market was largely focused on Phase 3 or commercial-stage products.
When a biotech company seeks to raise money during the development process, they often are faced with three options – give up ownership of their company in order to raise equity capital, take on debt, or discontinue a promising program because financing isn’t available. Historically, there have been few options to monetize royalties at a pre-commercial stage.
We knew we had an opportunity to build upon XOMA Royalty’s strong license portfolio and deliver shareholder value by addressing a clear market need. We offer a fourth option to the biotech industry – access to non-dilutive, non-recourse capital in exchange for the contractual rights to future milestones and royalties.
Today, XOMA Royalty monetizes and aggregates royalty payment rights associated with pre-commercial drug candidates and commercial therapies. Our core focus is on development-stage assets with blockbuster potential that are licensed to well-capitalized partners. We also acquire royalties on commercialized therapies that address the needs of specific patient populations. We use a portfolio approach to acquire new assets, thereby mitigating single-asset binary exposure. We operate under a capital-efficient structure – all R&D costs are borne by the partners, and we maintain a lean infrastructure – to attempt to deliver shareholder value as the assets in our royalty license portfolio advance and commercial products generate royalty revenue.
