XBiotech Inc.
For the period ended Dec 31, 2025. Filed Mar 13, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 13, 2026
XBIT$1.89+1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-18.
0001171843-25-001527
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-13.
0001171843-26-001561
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 59 previous paragraphs and 59 current paragraphs.
45 unchanged; 11 reworded; 3 added; 3 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (3)
Current report
Research and development expenses increased 26% to $47.4 million for the year ended December 31, 2025 compared to $37.8 million for the year ended December 31, 2024. The rise was mainly due to the increase in salaries and related expenses. John Simard retired from his role as President and Chief Executive Officer effective December 8, 2025. Pursuant to Section 8(c) of Mr. Simard’s Executive Employment Agreement, the Company paid a severance amount of $17.3 million, and Mr. Simard’s 2025 annual bonus of $4.5 million was approved by the Compensation Committee in December 2025. A total of 85% of Mr. Simard’s compensation was allocated to research and development expenses, with the remainder allocated to general and administrative expenses. The decrease in clinical trial and sponsored research expenses was primarily due to the absence of clinical trials in progress during 2025. In addition, stock-based compensation increased due to the issuance of stock options with immediate vesting and grant date fair value at $3.0 million to Mr. Simard in March 2025, with 85% of the expense allocated to research and development. Other expenses primarily included approximately $5.0 million of facility-related expenditures for both the year ended December 31, 2025 and 2024 and miscellaneous costs such as travel, equipment maintenance, and laboratory safety.
Current report
General and administrative expenses increased 76% to $8.3 million for the year ended December 31, 2025 compared to $4.7 million for the year ended December 31, 2024. This increase was primarily driven by higher salaries and related expenses resulting from John Simard’s severance payment and his 2025 annual bonus, with 15% of the expense allocated to general and administrative expenses. In addition, share-based compensation expense increased due to the issuance of stock options with immediate vesting and a grant-date fair value of $3.0 million to Mr. Simard in March 2025, of which 15% was allocated to general and administrative expenses.
Current report
During the years ended December 31, 2025 and 2024, our investing activities used net cash of $0.3 million and $1.3 million, respectively. The use of cash was for fixed asset purchases and the preparation for a new facility.
Removed paragraphs (3)
Previous report
Research and development expenses increased 15% to $37.8 million for the year ended December 31, 2024 compared to $32.8 million for the year ended December 31, 2023. The rise was mainly due to the increase in salaries and related expenses, resulting from the company-wide bonuses distributed during the year and the growth in the number of R&D employees from 79 in 2023 to 89 in 2024. The increase in clinical trial and sponsored research was primarily due to a new study being initiated in the second quarter of 2023. In addition, there is a decrease in share-based compensation, which was due to the decreased stock option expense per share of new grants compared to the expense of fully amortized grants.
Previous report
General and administrative expenses increased 1% to $4.7 million for the year ended December 31, 2024. The decrease in professional fees was caused by the service fees associated with the tender offer in June 2023, and a decrease in expense associated with tax services. The increase in salaries and related expenses was due to the company-wide bonuses. In addition, the patent filing expense increased mainly due to the transfer of patents from Janssen to XBiotech.
Previous report
During the years ended December 31, 2024 and 2023, our investing activities used net cash of $1.3 million and generated net cash of $61.5 million, respectively. In July 2022, we purchased interest bearing time deposits in the amount of $63.3 million. Upon maturity in July 2023, we obtained both the principal amount and the accrued interest.
Reworded paragraphs (11)
Previous wording
Following the Janssen Transaction in December 2019, the tender offer in February 2020, and the dividends paid in July 2021, our accumulated deficit as of December 31, 2024 was ($90.8) million. We had a net loss of $38.5 million for the year ended December 31, 2024, compared to a net loss of $24.6 million for the year ended December 31, 2023. During the fiscal year of 2025, we don’t expect to generate any revenue. In addition, we expect to incur significant and increasing operating losses for the foreseeable future as we advance our drug candidates from discovery through preclinical testing and clinical. In addition to these research and development expenses, we expect general and administrative costs to increase, particularly in consideration of current inflationary trends. We will need to generate significant revenues to achieve or sustain profitability, and we may never do so. As of December 31, 2024, we had 92 employees.
Current wording
Following the Janssen Transaction in December 2019, the tender offer in February 2020, and the dividends paid in July 2021, our accumulated deficit as of December 31, 2025 was ($136.3) million. We had a net loss of $45.5 million for the year ended December 31, 2025, compared to a net loss of $38.5 million for the year ended December 31, 2024. During the fiscal year of 2026, we don’t expect to generate any revenue. In addition, we expect to incur significant and increasing operating losses for the foreseeable future as we advance our drug candidates from discovery through preclinical testing and clinical. In addition to these research and development expenses, we expect general and administrative costs to increase, particularly in consideration of current inflationary trends. We will need to generate significant revenues to achieve or sustain profitability, and we may never do so. As of December 31, 2025, we had 85 employees.
Previous wording
Clinical development timelines, likelihood of success and total costs vary widely. We do not currently track our internal research and development costs or our personnel and related costs on an individual drug candidate basis. We use our research and development resources, including employees and our drug discovery technology, across multiple drug development programs. As a result, we cannot state precisely the costs incurred for each of our research and development programs or our clinical and preclinical drug candidates. From inception through December 31, 2024, we have recorded total research and development expenses, including share-based compensation, of $349.7 million. Our total research and development expenses for the year ended December 31, 2024 was $37.8 million, compared to $32.8 million the year ended December 31, 2023. Share-based compensation accounted for $1.1 million for the year ended December 31, 2024 and $2.8 million for the year ended December 31, 2023.
Current wording
Clinical development timelines, likelihood of success and total costs vary widely. We do not currently track our internal research and development costs or our personnel and related costs on an individual drug candidate basis. We use our research and development resources, including employees and our drug discovery technology, across multiple drug development programs. As a result, we cannot state precisely the costs incurred for each of our research and development programs or our clinical and preclinical drug candidates. From inception through December 31, 2025, we have recorded total research and development expenses, including share-based compensation, of $397.1 million. Our total research and development expenses for the year ended December 31, 2025 was $47.4 million, compared to $37.8 million the year ended December 31, 2024. Share-based compensation accounted for $2.7 million for the year ended December 31, 2025 and $1.1 million for the year ended December 31, 2024.
Previous wording
Research and development expenses as a percentage of total operating expenses was 89% for the year ended December 31, 2024, and 88% for the year ended December 31, 2023. The percentages, excluding share-based compensation, were 90% for the year ended December 31, 2024, and 88% for the year ended December 31, 2023.
Current wording
Research and development expenses as a percentage of total operating expenses was 85% for the year ended December 31, 2025, and 89% for the year ended December 31, 2024. The percentages, excluding share-based compensation, were 86% for the year ended December 31, 2025, and 90% for the year ended December 31, 2024.
Previous wording
General and administrative expense consists primarily of salaries and related expenses for personnel in administrative, finance, business development and human resource functions, as well as the legal costs of pursuing patent protection of our intellectual property and patent filing and maintenance expenses, share–based compensation, and professional fees for legal services. Our total general and administration expenses was $4.7 million for both the year ended December 31, 2024, and December 31, 2023. Share-based compensation accounted for $0.6 million for the year ended December 31, 2024, and $0.5 million for the year ended December 31, 2023.
Current wording
General and administrative expense consists primarily of salaries and related expenses for personnel in administrative, finance, business development and human resource functions, as well as the legal costs of pursuing patent protection of our intellectual property and patent filing and maintenance expenses, share–based compensation, and professional fees for legal services. Our total general and administration expenses was $8.3 million for the year ended December 31, 2025, and $4.7 million for the year ended December 31, 2024. Share-based compensation accounted for $0.9 million for the year ended December 31, 2025, and $0.6 million for the year ended December 31, 2024.
Previous wording
General and administrative expenses as a percentage of total operating expenses was 11% for the year ended December 31, 2024, and 12% for the year ended December 31, 2023. The percentages, excluding share-based compensation, were 10% for the year ended December 31, 2024, and 12% for the year ended December 31, 2023.
Current wording
General and administrative expenses as a percentage of total operating expenses was 15% for the year ended December 31, 2025, and 11% for the year ended December 31, 2024. The percentages, excluding share-based compensation, were 14% for the year ended December 31, 2025, and 10% for the year ended December 31, 2024.
Previous wording
The interest income for the years ended December 31, 2024 and 2023 was mainly generated from the Company’s Canadian bank accounts and interest bearing time deposits. The interest expense for the years ended December 31, 2024 was the interest for the convertible loans. The other income during the year ended December 31, 2024 was mainly from the reversal of the previous clinical trial accrual associated with visits that occurred more than 3 years ago for which the Company has not received an invoice. In June 2023, the Company received a sum of $750 thousand from American Stock Transfer & Trust Company, LLC which was recorded as other income during 2023. Foreign exchange gain (loss) was due to the fluctuation between the US dollar and the Canadian dollar in the year ended December 31, 2024 compared to 2023.
Current wording
Interest income for the years ended December 31, 2025 and 2024 was primarily generated from the Company’s Canadian bank accounts and decreased due to lower interest rates and a lower cash balance. Interest expense for the years ended December 31, 2025 and 2024 related to interest on the Company’s convertible loans. The other income during the year ended December 31, 2025 was primarily attributable to the receipt of the Employee Retention Credit from the Internal Revenue Service and the cancellation of a penalty by the Canada Revenue Agency related to the 2020 tax year. The other income during the year ended December 31, 2024 was mainly from the reversal of the previous clinical trial accrual associated with visits that occurred prior to 2022 for which the Company has not received an invoice. Foreign exchange gain (loss) was due to the fluctuation between the US dollar and the Canadian dollar during the reporting periods.
Previous wording
The Company’s income tax benefit for the tax period ended December 31, 2024 of $0.03 million was primarily driven by uncertain tax position activity and the estimated 2024 Canadian loss carryback to 2023. The Company’s income tax expense for the tax period ended December 31, 2023 of $0.24 million was primarily driven by adjustments related to prior periods and current year uncertain tax positions. The Company expects to maintain its full valuation allowance on all jurisdictions during 2025.
Current wording
The Company’s income tax expense for the tax year ended December 31, 2025 of $0.23 million was primarily driven by state gross margin taxes and current year uncertain tax positions. The Company’s income tax benefit for the tax year ended December 31, 2024 of $0.03 million was primarily driven by uncertain tax position activity and the estimated 2024 Canadian loss carryback to 2023. The Company expects to maintain its full valuation allowance on all jurisdictions during 2025.
Previous wording
Since our inception on March 22, 2005 through December 31, 2024, we have funded our operations principally through private placements and public offerings of equity securities, which have provided aggregate cash proceeds of approximately $118.2 million. We received $675 million in cash proceeds from the Janssen Transaction in the year ended December 31, 2019. In June 2021, we received the remaining $75 million in cash from the escrow receivable from the same transaction. In July 2021, we paid $75 million in dividends to shareholders. In July 2022, we purchased interest bearing time deposits in the amount of $59.5 million for a one-year term, and upon maturity in July 2023, both the principal amount and the accrued interest were returned. At December 31, 2024, we had cash and cash equivalents of $172.7 million as compared to cash and cash equivalents of $200.0 million at December 31, 2023. The following table summarizes our sources and uses of cash (in thousands):
Current wording
Since our inception on March 22, 2005 through December 31, 2025, we have funded our operations principally through private placements and public offerings of equity securities, which have provided aggregate cash proceeds of approximately $276.3 million, excluding the February 2020 tender offer cash payment. We received $675 million in cash proceeds from the Janssen Transaction in the year ended December 31, 2019. In June 2021, we received the remaining $75 million in cash from the escrow receivable from the same transaction. In July 2021, we paid $75 million in dividends to shareholders. At December 31, 2025, we had cash and cash equivalents of $125.6 million as compared to cash and cash equivalents of $172.7 million at December 31, 2024. The following table summarizes our sources and uses of cash (in thousands):
Previous wording
During the years ended December 31, 2024 and 2023 net cash used in operating activities was $31.0 million and $18.7 million, respectively. Net cash used in the years ended December 31, 2024 and 2023 primarily resulted from our net losses. The rise was mainly due to the increase in salaries and related expenses and clinical trial expenses.
Current wording
During the years ended December 31, 2025 and 2024 net cash used in operating activities was $39.9 million and $31.0 million, respectively. Net cash used in the years ended December 31, 2025 and 2024 primarily resulted from our net losses. The rise in net losses was mainly due to the increase in salaries and related expenses.
Previous wording
During the year ended December 31, 2024, our financing activities provided net cash of $10.5 million. On January 3, 2024, we entered into a Convertible Loan Agreement (the “Loan”) with John Simard, the Company’s Founder, President, Chief Executive Officer and Chairman, which provided $10 million net cash for the construction of a new facility. Additionally, during the year ended December 31, 2024, employees exercised stock options to purchase 50,767 shares of our common stock for approximately $200 thousand in net proceeds. During the year ended December 31, 2023, our financing activities used net cash of $9 thousand. On June 20, 2023, we used approximately $14 thousand to purchase 3,561 common shares at a price of $4.00 per share, relating to the tender offer completed in June 2023. During the year ended December 31, 2023, employees exercised stock options to purchase 1,250 shares of our common stock for approximately $5 thousand in net proceeds.
Current wording
During the year ended December 31, 2025 and 2024, the net cash (used in) provided by our financing activities was mainly related to the convertible loan. On January 3, 2024, we entered into a convertible loan agreement (the “Loan”) with John Simard, the Company’s Founder, Chairman and former President and Chief Executive Officer, which provided $10 million net cash for the construction of a new, state-of-the-art research and development facility at the Company's property at 5217 Winnebago Lane in Austin, Texas. On January 31, 2025, the Loan was terminated upon full repayment of the principal and interest by the Company. Additionally, during the year ended December 31, 2024, employees exercised stock options to purchase 50,767 shares of our common stock for approximately $200 thousand in net proceeds.
Previous wording
We expect to continue to incur operating losses in the future. We do not expect to receive any additional revenue under the clinical manufacturing agreement with Janssen, as the clinical manufacturing agreement terminated in November 2022. Further, we may not receive any product revenue until a drug candidate has been approved by the FDA, EMA or similar regulatory agencies in other countries and successfully commercialized. As of December 31, 2024, our principal sources of liquidity were our cash and cash equivalents, which totaled approximately $172.7 million.
Current wording
We expect to continue to incur operating losses in the future. We do not expect to receive any additional revenue under the clinical manufacturing agreement with Janssen. Further, we may not receive any product revenue until a drug candidate has been approved by the FDA, EMA or similar regulatory agencies in other countries and successfully commercialized. As of December 31, 2025, our principal sources of liquidity were our cash and cash equivalents, which totaled approximately $125.6 million.