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CORRECTED - UPDATE 1-Xoma gets going-concern warning
March 12, 2009 / 12:44 AM / in 9 years

CORRECTED - UPDATE 1-Xoma gets going-concern warning

(Corrects to show in bullet point and paragraph two that Xoma reported a quarterly profit instead of loss. Removes word from lead.)

* Accounting firm includes going-concern warning

* Posts Q4 profit

March 11 (Reuters) - Xoma Ltd (XOMA.O) said its auditors expressed doubt about the drugmaker’s ability to function as a going concern due to the anticipated decline in royalty revenue from psoriasis drug Raptiva and its impact on a loan.

Xoma, which reported a fourth-quarter net profit on Wednesday, said it would not give outlook on 2009 revenue or cash receipts due to the ongoing negotiations for its experimental diabetes drug XOMA 052, and the general economic and market conditions. [ID:nWNAB2978]

The company expects sales of Raptiva to fall significantly in Europe and Canada, and possibly in the United States. XOMA receives mid-single-digit royalties on worldwide sales of Raptiva.

Xoma has marketing collaborations with Genentech Inc DNA.N and Merck Serono, a division of Merck KGaA (MRCG.DE).

The company said authorities recommended suspension of Raptiva in the European Union due to safety issues, and Merck Serono’s Canadian affiliate said it would suspend marketing Raptiva there.

U.S. authorities also issued a public safety warning on Raptiva, Xoma said.

Shares of the company closed at 50 cents Wednesday on Nasdaq. (Reporting by Esha Dey in Bangalore; editing by Vinu Pilakkot)

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