Xenon Q4 Loss Wider Than Expected, Pipeline Development in Focus

Xenon Pharmaceuticals XENE reported a loss of $1.31 per share for the fourth quarter of 2025, wider than the Zacks Consensus Estimate of a loss of $1.20. The company had incurred a loss of 84 cents per share in the year-ago quarter.

In the reported quarter, Xenon did not generate any revenues. Due to the absence of a marketed product, the company only recognizes periodic collaboration revenues in its top line from its ongoing partnership with Neurocrine Biosciences NBIX. The company did not recognize any revenues in the year-ago quarter as well.

XENE's Q3 Results in Detail

In the fourth quarter, research and development (R&D) expenses increased 47% year over year to $87.7 million. The uptick was primarily due to increased expenses related to the company’s ongoing azetukalner late-stage studies in epilepsy, major depressive disorder (MDD) and bipolar depression (BPD).

General and administrative expenses totaled $22.1 million in the reported quarter, up 23% year over year due to higher personnel expenses from a larger workforce and an increase in professional and consulting fees.

Xenon had cash, cash equivalents and marketable securities worth $586 million as of Dec. 31, 2025, compared with $555.3 million as of Sept. 30, 2025. The company expects its existing cash balance to fund its current operating plans, which include the completion of the azetukalner phase III epilepsy studies and supporting late-stage clinical development of azetukalner in MDD and BPD into the second half of 2027.

In the past six months, XENE shares have gained 16.4% compared with the industry’s 23.1% growth.

XENE's Full-Year 2025 Results

In 2025, Xenon recorded total revenues of $7.5 million compared to none in 2024.

The company recorded a loss of $4.36 per share in 2025, which is wider than the loss of $3.01 recorded in 2024.

XENE's Pipeline Updates

Xenon’s lead pipeline candidate, azetukalner, is in late-stage studies for treating focal onset seizures (FOS). Under the phase III epilepsy program, two identical phase III studies, X-TOLE2 and X-TOLE3, are evaluating 15 mg or 25 mg doses of azetukalner, administered with food as adjunctive treatment in patients with FOS. The first top-line data readout from the X-TOLE2 study, which has completed patient enrollment, is anticipated in the first half of March 2026. The X-TOLE3 study is currently enrolling patients and is intended to support potential regulatory submissions for azetukalner for FOS in ex-U.S. jurisdictions.

XENE is also evaluating azetukalner for primary generalized tonic-clonic seizures in a phase III X-ACKT study, which is currently enrolling patients.

Xenon’s first two of three planned phase III clinical studies, X-NOVA2 and X-NOVA3, evaluating azetukalner in patients with MDD, are currently underway, with top-line data from X-NOVA2 expected in the first half of 2027.

XENE’s first of two phase III clinical studies, X-CEED, evaluating azetukalner in patients with BPD I or II, is also currently ongoing.

Xenon has initiated two separate early-stage studies evaluating XEN1120 and XEN1701, targeting Kv7 and Nav1.7, respectively, for a range of therapeutic indications, including seizure disorders, pain and neuropsychiatric disorders, such as MDD and BPD.

XENE, in collaboration with Neurocrine Biosciences, is currently evaluating NBI-921355, a Nav1.2/1.6 inhibitor, in a phase I study as a potential treatment for certain types of epilepsy. In early 2025, Xenon received a $7.5 million milestone payment from Neurocrine Biosciences in connection with the progress of NBI-921355 into a clinical-stage study.

Xenon Pharmaceuticals Inc. Price, Consensus and EPS Surprise

Xenon Pharmaceuticals Inc. price-consensus-eps-surprise-chart | Xenon Pharmaceuticals Inc. Quote

XENE's Zacks Rank & Stocks to Consider

Xenon currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the biotech sector are USANA Health Sciences USNA and Recursion Pharmaceuticals RXRX. While USNA currently sports a Zacks Rank #1 (Strong Buy), RXRX has a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Over the past 60 days, estimates for USANA Health Sciences’ 2026 earnings per share have risen from $1.90 to $2.00. USNA shares have lost 32.4% over the past six months.

USANA Health Sciences’ earnings beat estimates in three of the trailing four quarters and matched once, with the average surprise being 21.92%.

Over the past 60 days, estimates for Recursion Pharmaceuticals’ 2026 loss per share have narrowed from $1.08 to $1.03. RXRX shares have lost 22.9% over the past six months.

Recursion Pharmaceuticals’ earnings beat estimates in two of the trailing four quarters and missed in the remaining two quarters, with the average negative surprise being 0.13%.

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This article originally published on Zacks Investment Research (zacks.com).

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