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On Tuesday, Xilio Therapeutics, Inc., a Delaware-incorporated biopharmaceutical company with a market capitalization of $38.6 million, announced entering into a sales agreement with Leerink Partners LLC. Under this arrangement, Xilio may offer up to $50 million of its common stock in "at the market" transactions through the Nasdaq Global Select Market. According to InvestingPro data, the company has been quickly burning through cash, making this capital raise crucial for its operations.
The agreement with Leerink Partners, which will serve as the sales agent, allows Xilio to sell shares from time to time at prevailing market prices, currently at $0.85 per share. Leerink Partners will receive a commission of 3% on the gross proceeds from the sale of any shares under this agreement. However, there is no obligation for a fixed amount of securities to be sold. Notably, analysts tracked by InvestingPro maintain price targets between $4 and $5, suggesting significant upside potential.
This move is a part of Xilio’s efforts to strengthen its financial position by leveraging its Registration Statement on Form S-3, effective since November 18, 2022. The specific terms of the sales are detailed in a prospectus supplement filed with the SEC on the same day as the agreement.
The company has assured indemnification to Leerink Partners for certain liabilities that may arise, including those under the Securities Act or the Securities Exchange Act of 1934. Both Xilio and Leerink Partners have the right to terminate the sales agreement upon prior written notice.
It is important to note that there is no guarantee that any shares will be sold under this agreement, nor are the timing, amount, and price of any sales predetermined.
This strategic move allows Xilio Therapeutics to potentially access additional capital to advance its pharmaceutical preparations business. While the company maintains more cash than debt on its balance sheet, its EBITDA stands at -$62.4 million for the last twelve months. The company’s stock is listed on the Nasdaq Global Select Market under the ticker symbol XLO, and InvestingPro analysis indicates the stock is currently undervalued, with 5 additional ProTips available for subscribers.
The information for this report is based on a press release statement and the company’s recent SEC filing.
In other recent news, Xilio Therapeutics announced its fourth quarter and full-year financial results for 2024, highlighting a solid cash position with $55.3 million in cash and cash equivalents as of December 31, 2024. The company reported license revenue of $1.7 million for the fourth quarter and $6.3 million for the full year, primarily from an agreement with Gilead Sciences (NASDAQ:GILD). Xilio also announced a significant collaboration with AbbVie (NYSE:ABBV) to develop novel tumor-activated immunotherapies, including masked T cell engagers, which includes a $52.0 million upfront payment and potential future payments totaling approximately $2.1 billion. This collaboration was publicized in February 2025 and involves AbbVie’s oncology expertise combined with Xilio’s proprietary tumor-activation technology.
The partnership aims to focus on the development of antibody-based immunotherapies, leveraging Xilio’s clinically-validated platform technology for tumor-activated biologics. Xilio’s technology is designed for tumor-selective activation, potentially minimizing systemic adverse events and improving cancer treatment efficacy. Additionally, the company is advancing its pipeline with promising initial Phase 2 data for vilastobart, a monoclonal antibody, showing a 27% objective response rate in metastatic microsatellite stable colorectal cancer patients. The company’s future plans include IND application enabling studies for XTX501, with an IND submission planned for mid-2026. These recent developments mark significant progress in Xilio’s efforts to advance next-generation cancer treatments.
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