0000950170-24-125547 | 10-Q | XBRL Viewer | Xenon Pharmaceuticals INC

Leases

9 Months Ended

Sep. 30, 2024

Leases:

The Company has an operating lease for research laboratories and office space in Burnaby, British Columbia which expires on June 30, 2032, and two renewal options for 5-years each which were not considered in the determination of the right-of-use asset and lease liability. The Company has an additional operating lease for office space in Needham, Massachusetts ("Needham Lease"), which commenced in October 2022. The Needham Lease is for a 62-month term and an option to terminate one year prior to the expiry date, which was not considered in the determination of the right-of-use asset and lease liability.

The cost components of the operating leases were as follows for the three and nine months ended September 30, 2024 and 2023:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Lease Cost
Operating lease expense	$	411		$	412		$	1,234		$	1,235
Variable lease expense(1)		206			198			619			593
Lease Term and Discount Rate
Weighted average remaining lease term (years)		6.66			7.52			6.66			7.52
Weighted average discount rate		3.84	%		3.89	%		3.84	%		3.89	%

(1)

Variable lease costs are payments that vary because of changes in facts or circumstances and include common area maintenance and property taxes related to the premises. Variable lease costs are excluded from the calculation of minimum lease payments.

Future minimum lease payments as of September 30, 2024 were as follows:


Year ending December 31:
2024	$	430
2025		1,747
2026		1,815
2027		1,802
2028		1,103
2029 and thereafter		4,195
Total future minimum lease payments	$	11,092
Less: imputed interest		(1,306	)
Present value of lease liabilities	$	9,786

Share Capital (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Schedule Of Pre-Funded Warrants Activity

The following table summarizes the pre-funded warrants activity for the three and nine months ended September 30, 2024 and 2023:


	Three Months Ended September 30,					Nine Months Ended September 30,
	2024		2023			2024		2023
Outstanding, beginning of period		2,173,081		2,253,858			2,173,081		3,103,864
Exercised (1)		—		(425,004	)		—		(1,275,010	)
Outstanding, end of period		2,173,081		1,828,854			2,173,081		1,828,854

(1)

During the nine months ended September 30, 2023, the Company issued 1,275,000 common shares upon the exercise of 1,275,010 pre-funded warrants pursuant to a net exercise mechanism under the warrants.

Stock Option Activity

The following table presents stock option activity for the nine months ended September 30, 2024 and 2023:


	Nine Months Ended September 30,
	2024			Weighted Average Exercise Price ($)		2023			Weighted Average Exercise Price ($)
Outstanding, beginning of period		8,894,502			23.56		7,117,782			18.75
Granted		2,854,719			43.08		2,457,173			35.30
Exercised(1)		(627,662	)		13.81		(398,097	)		11.21
Forfeited, cancelled or expired		(108,180	)		37.53		(170,617	)		31.27
Outstanding, end of period		11,013,379			29.04		9,006,241			23.36
Exercisable, end of period		5,975,121			21.00		4,618,002			15.71

(1)

During the nine months ended September 30, 2024, the Company issued 423,432 (2023 – 283,863) common shares for the cashless exercise of 627,662 (2023 – 398,097) stock options.

Fair Value Assumptions for Stock Options

The fair value of each stock option granted is estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:


	Nine Months Ended September 30,
	2024			2023
Average risk-free interest rate		4.05	%		3.91	%
Expected volatility		66	%		69	%
Average expected term (in years)		5.82			5.99
Expected dividend yield		0	%		0	%
Weighted average fair value of stock options granted	$	26.72		$	22.59

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Operating activities:
Net loss	$ (168,645)	$ (137,650)
Items not involving cash:
Accretion of discounts on marketable securities	(859)	(5,849)
Depreciation	1,927	2,690
Deferred income tax recovery	(252)	(92)
Stock-based compensation	37,118	23,190
Unrealized foreign exchange (gain) loss	182	(753)
Unrealized fair value gain on trading securities		(3,404)
Changes in operating assets and liabilities:
Accounts receivable	(67)	424
Prepaid expenses and other current assets	1,245	4,103
Accounts payable and accrued expenses	2,347	1,630
Net cash used in operating activities	(127,004)	(115,711)
Investing activities:
Purchases of property, plant and equipment	(2,292)	(5,539)
Purchases of marketable securities	(465,914)	(417,319)
Proceeds from marketable securities	534,703	551,263
Net cash provided by investing activities	66,497	128,405
Financing activities:
Issuance of common shares, net of issuance costs (note 9a)		29,508
Net cash provided by financing activities		29,508
Effect of exchange rate changes on cash and cash equivalents	(515)	130
Increase (decrease) in cash and cash equivalents	(61,022)	42,332
Cash and cash equivalents, beginning of period	148,643	57,242
Cash and cash equivalents, end of period	87,621	99,574
Supplemental disclosure:
Cash paid for operating lease	1,245	1,219
Cash received for lease incentives		1,265
Supplemental disclosures of non-cash transactions:
Fair value of stock options exercised on a cashless basis	$ 5,440	3,183
Fair value of pre-funded warrants exercised		24,141
Increase in operating lease liability and accounts receivable related to lease incentives claimed in the period		$ 226

Marketable Securities (Tables)

9 Months Ended

Sep. 30, 2024

Investments, Debt and Equity Securities [Abstract]

Summary of Amortized Cost, Unrealized Gain (Loss) Recognized in AOCI and Fair Value of Available-for-Sale Securities

Amortized cost, unrealized gain (loss) recognized in accumulated other comprehensive income (loss) and fair value of available-for-sale securities consisted of the following:


	September 30, 2024							December 31, 2023
	Amortized Cost		Unrealized Gain (Loss)			Fair Value		Amortized Cost		Unrealized Gain (Loss)			Fair Value
Contractual maturity of 0 to 1 years:
Guaranteed investment certificates	$	15,479	$	14		$	15,493	$	7,549	$	135		$	7,684
U.S. treasuries		100,314		78			100,392		192,193		(249	)		191,944
U.S. government securities		27,106		(10	)		27,096		98,092		(180	)		97,912
Commercial paper		107,074		245			107,319		119,041		67			119,108
Corporate debt securities		314,948		1,146			316,094		58,824		100			58,924
Contractual maturity of 1 to 3 years:
U.S. treasuries		71,893		349			72,242		53,294		243			53,537
Corporate debt securities		76,571		504			77,075		238,458		797			239,255
Total	$	713,385	$	2,326		$	715,711	$	767,451	$	913		$	768,364

- Definition

Tabular disclosure of investment in debt security measured at fair value with change in fair value recognized in other comprehensive income (available-for-sale).

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481800/320-10-50-9

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481800/320-10-50-3

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
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-Name Accounting Standards Codification
-Section 50
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-2

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-2

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
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-Section 50
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-2

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-3

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-3

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481800/320-10-50-3

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481800/320-10-50-3

+ Details

Share Capital (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share Capital [Line Items]
Warrants outstanding to purchase common stock	1,828,854	1,828,854	2,173,081	1,828,854
Sale proceeds of common shares				$ 29,508
Warrants exercise price per common share			$ 0.0001
Shares granted			210,000
Shares vested			0
Common Shares [Member]
Share Capital [Line Items]
Shares issued		855,685
Jefferies and Stifel [Member] \| ATM [Member]
Share Capital [Line Items]
Sale proceeds of common shares	$ 29,508
Jefferies and Stifel [Member] \| ATM [Member] \| Maximum [Member]
Share Capital [Line Items]
Gross proceeds from issuable of common stock			$ 350,000
Jefferies and Stifel [Member] \| ATM [Member] \| Common Shares [Member]
Share Capital [Line Items]
Shares issued	855,685		0

Commitments and Contingencies

9 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

10.

Commitments and contingencies:

(a)

Asset purchase agreement with 1st Order Pharmaceuticals, Inc. (“1st Order”):

In April 2017, the Company acquired azetukalner from 1st Order pursuant to an asset purchase agreement. In August 2020, the Company and 1st Order amended the asset purchase agreement to amend certain definitions in the agreement and to modify the payment schedule for certain milestones. Through September 30, 2024, the Company has paid $2,000 based on progress against these milestones. Future potential payments to 1st Order include up to $6,000 in regulatory milestones. There are no royalty obligations to 1st Order.

(b)

Guarantees and indemnifications:

The Company has entered into license and research agreements with third parties that include indemnification provisions that are customary in the industry. These indemnification provisions generally require the Company to compensate the other party for certain damages and costs incurred as a result of third-party claims or damages arising from these transactions.

The maximum amount of potential future indemnification is unlimited; however, the Company currently holds commercial and product liability insurance. This insurance limits the Company’s exposure and may enable it to recover a portion of any future amounts paid. Historically, the Company has not made any indemnification payments under such agreements and the Company believes that the fair value of these indemnification obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations for any period presented.

Marketable Securities

9 Months Ended

Sep. 30, 2024

Investments, Debt and Equity Securities [Abstract]

Marketable Securities

Marketable securities

As of September 30, 2024, the Company had $715,711 of available-for-sale securities (December 31, 2023 – trading securities of $13,867 and available-for-sale-securities of $768,364). Amortized cost, unrealized gain (loss) recognized in accumulated other comprehensive income (loss) and fair value of available-for-sale securities consisted of the following:


	September 30, 2024							December 31, 2023
	Amortized Cost		Unrealized Gain (Loss)			Fair Value		Amortized Cost		Unrealized Gain (Loss)			Fair Value
Contractual maturity of 0 to 1 years:
Guaranteed investment certificates	$	15,479	$	14		$	15,493	$	7,549	$	135		$	7,684
U.S. treasuries		100,314		78			100,392		192,193		(249	)		191,944
U.S. government securities		27,106		(10	)		27,096		98,092		(180	)		97,912
Commercial paper		107,074		245			107,319		119,041		67			119,108
Corporate debt securities		314,948		1,146			316,094		58,824		100			58,924
Contractual maturity of 1 to 3 years:
U.S. treasuries		71,893		349			72,242		53,294		243			53,537
Corporate debt securities		76,571		504			77,075		238,458		797			239,255
Total	$	713,385	$	2,326		$	715,711	$	767,451	$	913		$	768,364

Allowance for credit losses or impairment on these marketable securities have not been recognized as these securities are high credit quality, investment grade securities that the Company does not intend to sell and will not be required to sell prior to their anticipated recovery, and the decline in fair value is primarily due to changes in interest rates.

Leases (Details)	9 Months Ended
Leases (Details)	Sep. 30, 2024 Lease Option	Oct. 31, 2022
Burnaby, British Columbia [Member]
Lessee Lease Description [Line Items]
Number of operating leases	1
Operating lease expiration date	Jun. 30, 2032
Operating lease, number of renewal options \| Option	2
Operating lease, description	The Company has an operating lease for research laboratories and office space in Burnaby, British Columbia which expires on June 30, 2032, and two renewal options for 5-years each which were not considered in the determination of the right-of-use asset and lease liability.
Burnaby, British Columbia [Member] \| First Renewal Option [Member]
Lessee Lease Description [Line Items]
Operating lease extension term	5 years
Burnaby, British Columbia [Member] \| Second Renewal Option [Member]
Lessee Lease Description [Line Items]
Operating lease extension term	5 years
Needham Massachusetts [Member]
Lessee Lease Description [Line Items]
Number of operating leases	1
Operating lease term		62 months
Operating lease, option to terminate	option to terminate one year prior to the expiry date
Operating lease, description	The Company has an additional operating lease for office space in Needham, Massachusetts ("Needham Lease"), which commenced in October 2022. The Needham Lease is for a 62-month term and an option to terminate one year prior to the expiry date, which was not considered in the determination of the right-of-use asset and lease liability.

Fair Value of Financial Instruments - Schedule of Financial Assets Measured at Fair Value on a Recurring Basis (Details) - Recurring Basis [Member] - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	$ 803,332	$ 930,874
Level 1 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	275,748	409,309
Level 2 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	527,584	521,565
Cash and Money Market Fund [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Cash and cash equivalents	87,621	148,643
Cash and Money Market Fund [Member] \| Level 1 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Cash and cash equivalents	87,621	148,643
Guaranteed Investment Certificates [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	15,493	7,684
Guaranteed Investment Certificates [Member] \| Level 1 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	15,493	7,684
U.S. Treasuries [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	172,634	252,982
U.S. Treasuries [Member] \| Level 1 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	172,634	252,982
U.S. Government Securities [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	27,096	97,912
U.S. Government Securities [Member] \| Level 2 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	27,096	97,912
Commercial Paper [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	107,319	119,108
Commercial Paper [Member] \| Level 2 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	107,319	119,108
Corporate Debt Securities [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	393,169	304,545
Corporate Debt Securities [Member] \| Level 2 [Member]
Financial Assets Measured at Fair Value on a Recurring Basis [Line Items]
Financial assets	$ 393,169	$ 304,545

Nature of the Business

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of the Business

Nature of the business:

Xenon Pharmaceuticals Inc. (the “Company”), incorporated in 1996 under the predecessor to the Business Corporations Act (British Columbia) and continued federally in 2000 under the Canada Business Corporations Act, is a neuroscience-focused biopharmaceutical company dedicated to discovering, developing, and delivering life-changing ion channel therapeutics for patients in need.

The Company has incurred significant operating losses since inception. As of September 30, 2024, the Company had an accumulated deficit of $833,785 and a net loss of $168,645 for the nine months ended September 30, 2024. Management expects to continue to incur significant expenses in excess of revenue and to incur operating losses for the foreseeable future. To date, the Company has financed its operations primarily through the sale of equity securities, funding received from collaboration and license agreements, and debt financings.

Until such time as the Company can generate substantial product revenue, if ever, management expects to finance the Company’s cash needs through a combination of collaboration agreements, equity and debt financings. The continuation of research and development activities and the future commercialization of its products are dependent on the Company’s ability to successfully raise additional funds when needed. It is not possible to predict either the outcome of future research and development programs or the Company’s ability to continue to fund these programs in the future.

Share Capital - Schedule of Pre-Funded Warrants (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Outstanding, beginning	2,173,081	2,253,858	2,173,081	3,103,864
Exercised	0	(425,004)	0	(1,275,010)
Outstanding, ending	2,173,081	1,828,854	2,173,081	1,828,854

Marketable Securities - Additional Information (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Investments, Debt and Equity Securities [Abstract]
Trading marketable securities		$ 13,867
Trading securities available-for-sale	$ 715,711	$ 768,364

- Definition

Amount of investment in debt security measured at fair value with change in fair value recognized in other comprehensive income (available-for-sale).

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 103
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482078/820-10-55-103

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/1943274/2147482078/820-10-55-100

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
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+ Details

- Definition

Amount of investment in debt security measured at fair value with change in fair value recognized in net income (trading).

+ References + Details

Net Income (Loss) Per Common Share

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Net Income (Loss) Per Common Share

Net income (loss) per common share:

The weighted average number of common shares used in the basic and diluted net income (loss) per common share calculations includes the weighted average pre-funded warrants outstanding during the period as they are exercisable at any time for nominal cash consideration.

The treasury stock method is used to compute the dilutive effect of the Company’s stock options, performance share units and warrants. Under this method, the incremental number of common shares used in computing diluted net income (loss) per common share is the difference between the number of common shares assumed issued and purchased using assumed proceeds.

For the three and nine months ended September 30, 2024 and 2023, diluted net loss per share attributable to common shareholders is the same as basic net loss per share attributable to common shareholders, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Leases - Schedule of Cost Components of Operating Lease (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Leases [Abstract]
Operating lease expense	$ 411	$ 412	$ 1,234	$ 1,235
Variable lease expense	$ 206	$ 198	$ 619	$ 593
Weighted average remaining lease term (years)	6 years 7 months 28 days	7 years 6 months 7 days	6 years 7 months 28 days	7 years 6 months 7 days
Weighted average discount rate	3.84%	3.89%	3.84%	3.89%

Leases (Tables)

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of Cost Components of Operating Lease

The cost components of the operating leases were as follows for the three and nine months ended September 30, 2024 and 2023:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Lease Cost
Operating lease expense	$	411		$	412		$	1,234		$	1,235
Variable lease expense(1)		206			198			619			593
Lease Term and Discount Rate
Weighted average remaining lease term (years)		6.66			7.52			6.66			7.52
Weighted average discount rate		3.84	%		3.89	%		3.84	%		3.89	%

(1)

Future Minimum Lease Payments

Future minimum lease payments as of September 30, 2024 were as follows:


Year ending December 31:
2024	$	430
2025		1,747
2026		1,815
2027		1,802
2028		1,103
2029 and thereafter		4,195
Total future minimum lease payments	$	11,092
Less: imputed interest		(1,306	)
Present value of lease liabilities	$	9,786

Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common shares, without par value
Common shares, shares authorized	Unlimited	Unlimited
Common shares, Issued	75,794,409	75,370,977
Common shares, Outstanding	75,794,409	75,370,977

Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Operating expenses:
Research and development	$ 56,970	$ 42,880	$ 150,922	$ 126,436
General and administrative	16,706	12,804	50,899	33,923
Total operating expenses	73,676	55,684	201,821	160,359
Loss from operations	(73,676)	(55,684)	(201,821)	(160,359)
Other income:
Interest income	10,329	6,982	32,521	18,929
Unrealized fair value gain on trading securities		490		3,404
Foreign exchange gain (loss)	237	(407)	414	289
Other income	10,566	7,065	32,935	22,622
Loss before income taxes	(63,110)	(48,619)	(168,886)	(137,737)
Income tax recovery	320	157	241	87
Net loss	(62,790)	(48,462)	(168,645)	(137,650)
Other comprehensive income (loss):
Unrealized gain on available-for-sale securities (note 6)	3,548	346	1,413	47
Comprehensive loss	$ (59,242)	$ (48,116)	$ (167,232)	$ (137,603)
Net loss per common share (note 4):
Basic	$ (0.81)	$ (0.73)	$ (2.17)	$ (2.09)
Diluted	$ (0.81)	$ (0.73)	$ (2.17)	$ (2.09)
Weighted-average common shares outstanding (note 4):
Basic	77,926,205	66,002,163	77,730,644	65,862,661
Diluted	77,926,205	66,002,163	77,730,644	65,862,661

Leases - Future Minimum Lease Payments (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
2024	$ 430
2025	1,747
2026	1,815
2027	1,802
2028	1,103
2029 and thereafter	4,195
Total future minimum lease payments	11,092
Less: imputed interest	(1,306)
Present value of lease liabilities	$ 9,786

Share Capital - Stock Option Activity (Details) - $ / shares	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Number of Options Outstanding, Beginning balance	8,894,502	7,117,782
Number of Options, Granted	2,854,719	2,457,173
Number of Options, Exercised	(627,662)	(398,097)
Number of Options, Forfeited, cancelled or expired	(108,180)	(170,617)
Number of Options Outstanding, Ending balance	11,013,379	9,006,241
Number of Options Exercisable, End of period	5,975,121	4,618,002
Weighted Average Exercise Price Outstanding, Beginning of period	$ 23.56	$ 18.75
Weighted Average Exercise Price, Granted	43.08	35.3
Weighted Average Exercise Price, Exercised	13.81	11.21
Weighted Average Exercise Price, Forfeited, cancelled and expired	37.53	31.27
Weighted Average Exercise Price Outstanding, End of period	29.04	23.36
Weighted Average Exercise Price, Exercisable, End of period	$ 21	$ 15.71

Document And Entity Information - shares	9 Months Ended
Document And Entity Information - shares	Sep. 30, 2024	Nov. 08, 2024
Cover [Abstract]
Entity Registrant Name	XENON PHARMACEUTICALS INC.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Entity Common Stock, Shares Outstanding		76,239,602
Entity Central Index Key	0001582313
Entity Filer Category	Large Accelerated Filer
Document Period End Date	Sep. 30, 2024
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Small Business	false
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity File Number	001-36687
Entity Tax Identification Number	98-0661854
Entity Address, Address Line One	3650 Gilmore Way
Entity Address, City or Town	Burnaby
Entity Address, State or Province	BC
Entity Address, Country	CA
Entity Address, Postal Zip Code	V5G 4W8
City Area Code	604
Local Phone Number	484-3300
Title of 12(b) Security	Common Shares, without par value
Trading Symbol	XENE
Security Exchange Name	NASDAQ
Entity Incorporation, State or Country Code	Z4
Document Quarterly Report	true
Document Transition Report	false

Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Schedule of Financial Assets Measured at Fair Value on a Recurring Basis

The level of the fair value hierarchy utilized to determine such fair values consisted of the following:


	September 30, 2024								December 31, 2023
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Cash and money market fund	$	87,621	$	—	$	—	$	87,621	$	148,643	$	—	$	—	$	148,643
Marketable securities
Guaranteed investment certificates		15,493		—		—		15,493		7,684		—		—		7,684
U.S. treasuries		172,634		—		—		172,634		252,982		—		—		252,982
U.S. government securities		—		27,096		—		27,096		—		97,912		—		97,912
Commercial paper		—		107,319		—		107,319		—		119,108		—		119,108
Corporate debt securities		—		393,169		—		393,169		—		304,545		—		304,545
Total	$	275,748	$	527,584	$	—	$	803,332	$	409,309	$	521,565	$	—	$	930,874

Accounts Payable and Accrued Expenses

9 Months Ended

Sep. 30, 2024

Payables and Accruals [Abstract]

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses:

Accounts payable and accrued expenses consisted of the following:


	September 30,		December 31,
	2024		2023
Trade payables	$	5,425	$	8,598
Employee compensation, benefits, and related accruals		8,942		7,425
Consulting and contracted research		11,297		8,824
Professional fees		1,564		780
Other		1,080		347
Total	$	28,308	$	25,974

Accounts Payable and Accrued Expenses (Tables)

9 Months Ended

Sep. 30, 2024

Payables and Accruals [Abstract]

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following:


	September 30,		December 31,
	2024		2023
Trade payables	$	5,425	$	8,598
Employee compensation, benefits, and related accruals		8,942		7,425
Consulting and contracted research		11,297		8,824
Professional fees		1,564		780
Other		1,080		347
Total	$	28,308	$	25,974

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (62,790)	$ (57,924)	$ (47,931)	$ (48,462)	$ (47,461)	$ (41,727)	$ (168,645)	$ (137,650)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-URI https://asc.fasb.org/1943274/2147483443/250-10-50-6

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147483443/250-10-50-9

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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Reference 16: http://www.xbrl.org/2003/role/disclosureRef
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
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Reference 19: http://www.xbrl.org/2003/role/disclosureRef
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Reference 20: http://www.xbrl.org/2003/role/disclosureRef
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Reference 21: http://www.xbrl.org/2003/role/disclosureRef
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Reference 22: http://www.xbrl.org/2003/role/disclosureRef
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Reference 23: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 24: http://www.xbrl.org/2003/role/disclosureRef
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Reference 25: http://www.xbrl.org/2003/role/disclosureRef
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Reference 26: http://www.xbrl.org/2003/role/disclosureRef
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Reference 27: http://www.xbrl.org/2003/role/disclosureRef
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Reference 28: http://www.xbrl.org/2003/role/disclosureRef
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Reference 29: http://www.xbrl.org/2003/role/disclosureRef
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Reference 30: http://www.xbrl.org/2003/role/disclosureRef
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Reference 33: http://www.xbrl.org/2003/role/disclosureRef
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Reference 34: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 35: http://www.xbrl.org/2003/role/disclosureRef
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Reference 36: http://www.xbrl.org/2003/role/disclosureRef
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Reference 37: http://fasb.org/us-gaap/role/ref/legacyRef
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+ Details

Share Capital - Schedule of Pre-Funded Warrants (Parenthetical) (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Common stock issued for pre-funded warrants				1,275,000
Exercise of pre-funded warrants	0	(425,004)	0	(1,275,010)

Accounts Payable and Accrued Expenses - Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Trade payables	$ 5,425	$ 8,598
Employee compensation, benefits, and related accruals	8,942	7,425
Consulting and contracted research	11,297	8,824
Professional fees	1,564	780
Other	1,080	347
Total	$ 28,308	$ 25,974

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 87,621	$ 148,643
Marketable securities (note 6)	566,394	489,439
Accounts receivable	938	874
Prepaid expenses and other current assets	4,686	6,006
Total current assets	659,639	644,962
Marketable securities, long-term (note 6)	149,317	292,792
Operating lease right-of-use asset, net (note 7)	8,258	9,193
Property, plant and equipment, net	10,162	9,653
Deferred tax assets	1,054	802
Prepaid expenses, long-term	7,471	7,396
Total assets	835,901	964,798
Current liabilities:
Accounts payable and accrued expenses (note 8)	28,308	25,974
Operating lease liability (note 7)	1,387	1,299
Total current liabilities	29,695	27,273
Operating lease liability, long-term (note 7)	8,399	9,604
Total liabilities	38,094	36,877
Shareholders’ equity:
Common shares, without par value; unlimited shares authorized; issued and outstanding: 75,794,409 (December 31, 2023 - 75,370,977) (note 9)	1,441,814	1,436,374
Additional paid-in capital	188,442	156,764
Accumulated deficit	(833,785)	(665,140)
Accumulated other comprehensive income (loss)	1,336	(77)
Total shareholders' equity	797,807	927,921
Total liabilities and shareholders’ equity	835,901	964,798
Commitments and contingencies (note 10)

Share Capital - Stock Option Activity (Parenthetical) (Details) - shares	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Common stock issued for cashless exercise	423,432	283,863
Cashless exercise of stock options	627,662	398,097

Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair value of financial instruments:

The fair value hierarchy consists of the following three levels:

•

Level 1 - Unadjusted quoted prices in active markets for identical instruments.

•

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

•

Level 3 - Inputs are unobservable and reflect the Company’s assumptions as to what market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available.

The Company’s cash and cash equivalents and marketable securities are measured at fair value on a recurring basis. The level of the fair value hierarchy utilized to determine such fair values consisted of the following:


	September 30, 2024								December 31, 2023
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Cash and money market fund	$	87,621	$	—	$	—	$	87,621	$	148,643	$	—	$	—	$	148,643
Marketable securities
Guaranteed investment certificates		15,493		—		—		15,493		7,684		—		—		7,684
U.S. treasuries		172,634		—		—		172,634		252,982		—		—		252,982
U.S. government securities		—		27,096		—		27,096		—		97,912		—		97,912
Commercial paper		—		107,319		—		107,319		—		119,108		—		119,108
Corporate debt securities		—		393,169		—		393,169		—		304,545		—		304,545
Total	$	275,748	$	527,584	$	—	$	803,332	$	409,309	$	521,565	$	—	$	930,874

The fair values of the Company’s U.S. government securities, commercial paper and corporate debt securities are based on prices obtained from independent pricing sources. Securities with validated quotes from pricing services are reflected within Level 2, as they are primarily based on observable pricing for similar assets or other market observable inputs. Typical inputs used by these pricing services include, but are not limited to, reported trades, benchmark yields, issuer spreads, bids, offers or estimates of cash flow, prepayment spreads and default rates.

As of September 30, 2024 and December 31, 2023, the Company did not hold any securities classified as Level 3.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details

Basis of Presentation (Additional Information) (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Accounting Policies [Abstract]
Prior period reclassification adjustment	$ 5,849

Share Capital - Fair Value Assumptions for Stock Options (Details) - $ / shares	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Fair Value Assumptions For Stock Options [Abstract]
Average risk-free interest rate	4.05%	3.91%
Expected volatility	66.00%	69.00%
Average expected term (in years)	5 years 9 months 25 days	5 years 11 months 26 days
Expected dividend yield	0.00%	0.00%
Weighted average fair value of stock options granted	$ 26.72	$ 22.59

Commitments and Contingencies (Details) - Asset Purchase Agreement [Member] - 1st Order Pharmaceuticals, Inc. [Member]	9 Months Ended
	Sep. 30, 2024 USD ($)
Commitments And Contingencies [Line Items]
Milestone payment paid	$ 2,000,000
Royalty obligations	0
Regulatory Milestone [Member] \| Maximum [Member]
Commitments And Contingencies [Line Items]
Future potential payments	$ 6,000,000

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2024 shares
Trading Arrangements, by Individual
Material Terms of Trading Arrangement	Rule 10b5-1 Trading Plans On September 27, 2024, Ian Mortimer, the Company’s President and Chief Executive Officer and a member of the Board of Directors, adopted a trading plan intended to satisfy the requirements of Rule 10b5-1(c) under the Securities Exchange Act of 1934, as amended. The plan provides that commencing January 7, 2025, Mr. Mortimer may sell up to an aggregate of 630,302 of the Company’s common shares, 605,000 of which are shares to be acquired upon the exercise of stock options. The plan terminates on the earlier of the date all shares under the trading plan are sold or June 30, 2026. The number of shares to be sold in accordance with this trading plan is subject to various minimum price targets, or limit prices, being met on each applicable predetermined sale date. In the event the minimum price targets are not met on the applicable predetermined sale date or on any subsequent predetermined sale date, the corresponding shares shall not be sold.
Non-Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Terminated	false
Rule10B 5-1 Trading Plan [Member] \| Ian Mortimer [Member]
Trading Arrangements, by Individual
Name	Ian Mortimer
Title	President and Chief Executive Officer and a member of the Board of Directors
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	September 27, 2024
Rule 10b5-1 Arrangement Terminated	true
Termination Date	June 30, 2026
Aggregate Available	630,302
Rule10B 5-1 Trading Plan One [Member] \| Ian Mortimer [Member]
Trading Arrangements, by Individual
Aggregate Available	605,000

Nature of the Business (Details) - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
Nature of the Business (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ 833,785						$ 833,785		$ 665,140
Net loss	$ 62,790	$ 57,924	$ 47,931	$ 48,462	$ 47,461	$ 41,727	$ 168,645	$ 137,650

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Stock-based compensation

Stock-based compensation:

The Company grants performance share unit awards (“PSUs”) to certain employees and officers.

PSUs vest upon the achievement of certain predefined company-specific performance-based criteria. PSUs are measured at the closing market price of the Company’s common shares on the date of grant. Stock-based compensation expense for PSUs is amortized on a straight-line basis over the requisite service period of each separately vesting tranche of the award once it is probable that the performance condition will be achieved.

- Definition

Disclosure of accounting policy for award under share-based payment arrangement. Includes, but is not limited to, methodology and assumption used in measuring cost.

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+ Details

Marketable Securities - Summary of Amortized Cost, Unrealized Gain (Loss) Recognized in AOCI and Fair Value of Available-for-Sale Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	$ 713,385	$ 767,451
Unrealized Gain (Loss)	2,326	913
Fair Value	715,711	768,364
Guaranteed Investment Certificates [Member]
Schedule Of Available For Sale Securities [Line Items]
Contractual maturity of 0 to 1 years, Amortized Cost	15,479	7,549
Contractual maturity of 0 to 1 years, Unrealized Gain (Loss)	14	135
Contractual maturity of 0 to 1 years, Fair Value	15,493	7,684
U.S. Treasuries [Member]
Schedule Of Available For Sale Securities [Line Items]
Contractual maturity of 0 to 1 years, Amortized Cost	100,314	192,193
Contractual maturity of 0 to 1 years, Unrealized Gain (Loss)	78	(249)
Contractual maturity of 0 to 1 years, Fair Value	100,392	191,944
Contractual maturity of 1 to 3 years, Amortized Cost	71,893	53,294
Contractual maturity of 1 to 3 years, Unrealized Gain (Loss)	349	243
Contractual maturity of 1 to 3 years, Fair Value	72,242	53,537
U.S. Government Securities [Member]
Schedule Of Available For Sale Securities [Line Items]
Contractual maturity of 0 to 1 years, Amortized Cost	27,106	98,092
Contractual maturity of 0 to 1 years, Unrealized Gain (Loss)	(10)	(180)
Contractual maturity of 0 to 1 years, Fair Value	27,096	97,912
Commercial Paper [Member]
Schedule Of Available For Sale Securities [Line Items]
Contractual maturity of 0 to 1 years, Amortized Cost	107,074	119,041
Contractual maturity of 0 to 1 years, Unrealized Gain (Loss)	245	67
Contractual maturity of 0 to 1 years, Fair Value	107,319	119,108
Corporate Debt Securities [Member]
Schedule Of Available For Sale Securities [Line Items]
Contractual maturity of 0 to 1 years, Amortized Cost	314,948	58,824
Contractual maturity of 0 to 1 years, Unrealized Gain (Loss)	1,146	100
Contractual maturity of 0 to 1 years, Fair Value	316,094	58,924
Contractual maturity of 1 to 3 years, Amortized Cost	76,571	238,458
Contractual maturity of 1 to 3 years, Unrealized Gain (Loss)	504	797
Contractual maturity of 1 to 3 years, Fair Value	$ 77,075	$ 239,255

Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Common Shares [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]	Accumulated Other Comprehensive Income Loss [Member]
Balance at Dec. 31, 2022	$ 721,497	$ 1,065,136	$ 142,108	$ (482,747)	$ (3,000)
Balance (in Shares) at Dec. 31, 2022		62,587,701
Net loss for the period	(41,727)			(41,727)
Conversion of pre-funded warrants to common shares (note 9b)		$ 7,379	(7,379)
Conversion of pre-funded warrants to common shares (note 9b) (in shares)		425,000
Stock-based compensation expense	5,994		5,994
Issued pursuant to exercise of stock options		$ 635	(635)
Issued pursuant to exercise of stock options (in Shares)		94,319
Other comprehensive income (loss) (note 6)	1,180				1,180
Balance at Mar. 31, 2023	686,944	$ 1,073,150	140,088	(524,474)	(1,820)
Balance (in Shares) at Mar. 31, 2023		63,107,020
Balance at Dec. 31, 2022	721,497	$ 1,065,136	142,108	(482,747)	(3,000)
Balance (in Shares) at Dec. 31, 2022		62,587,701
Net loss for the period	$ (137,650)
Issued pursuant to exercise of stock options (in Shares)	398,097
Balance at Sep. 30, 2023	$ 636,592	$ 1,121,968	137,974	(620,397)	(2,953)
Balance (in Shares) at Sep. 30, 2023		65,002,249
Balance at Mar. 31, 2023	686,944	$ 1,073,150	140,088	(524,474)	(1,820)
Balance (in Shares) at Mar. 31, 2023		63,107,020
Net loss for the period	(47,461)			(47,461)
Conversion of pre-funded warrants to common shares (note 9b)		$ 7,379	(7,379)
Conversion of pre-funded warrants to common shares (note 9b) (in shares)		425,000
Stock-based compensation expense	8,453		8,453
Issued pursuant to exercise of stock options		$ 2,479	(2,479)
Issued pursuant to exercise of stock options (in Shares)		186,330
Other comprehensive income (loss) (note 6)	(1,479)				(1,479)
Balance at Jun. 30, 2023	646,457	$ 1,083,008	138,683	(571,935)	(3,299)
Balance (in Shares) at Jun. 30, 2023		63,718,350
Net loss for the period	(48,462)			(48,462)
Issuance of common shares, net of issuance costs (note 9a)	29,508	$ 29,508
Issuance of common shares, net of issuance costs (note 9a) (Shares)		855,685
Conversion of pre-funded warrants to common shares (note 9b)		$ 9,383	(9,383)
Conversion of pre-funded warrants to common shares (note 9b) (in shares)		425,000
Stock-based compensation expense	8,743		8,743
Issued pursuant to exercise of stock options		$ 69	(69)
Issued pursuant to exercise of stock options (in Shares)		3,214
Other comprehensive income (loss) (note 6)	346				346
Balance at Sep. 30, 2023	636,592	$ 1,121,968	137,974	(620,397)	(2,953)
Balance (in Shares) at Sep. 30, 2023		65,002,249
Balance at Dec. 31, 2023	927,921	$ 1,436,374	156,764	(665,140)	(77)
Balance (in Shares) at Dec. 31, 2023		75,370,977
Net loss for the period	(47,931)			(47,931)
Stock-based compensation expense	9,400		9,400
Issued pursuant to exercise of stock options		$ 2,587	(2,587)
Issued pursuant to exercise of stock options (in Shares)		88,704
Other comprehensive income (loss) (note 6)	(1,692)				(1,692)
Balance at Mar. 31, 2024	887,698	$ 1,438,961	163,577	(713,071)	(1,769)
Balance (in Shares) at Mar. 31, 2024		75,459,681
Balance at Dec. 31, 2023	927,921	$ 1,436,374	156,764	(665,140)	(77)
Balance (in Shares) at Dec. 31, 2023		75,370,977
Net loss for the period	$ (168,645)
Issued pursuant to exercise of stock options (in Shares)	627,662
Balance at Sep. 30, 2024	$ 797,807	$ 1,441,814	188,442	(833,785)	1,336
Balance (in Shares) at Sep. 30, 2024		75,794,409
Balance at Mar. 31, 2024	887,698	$ 1,438,961	163,577	(713,071)	(1,769)
Balance (in Shares) at Mar. 31, 2024		75,459,681
Net loss for the period	(57,924)			(57,924)
Stock-based compensation expense	14,716		14,716
Issued pursuant to exercise of stock options		$ 1,497	(1,497)
Issued pursuant to exercise of stock options (in Shares)		207,869
Other comprehensive income (loss) (note 6)	(443)				(443)
Balance at Jun. 30, 2024	844,047	$ 1,440,458	176,796	(770,995)	(2,212)
Balance (in Shares) at Jun. 30, 2024		75,667,550
Net loss for the period	(62,790)			(62,790)
Stock-based compensation expense	13,002		13,002
Issued pursuant to exercise of stock options		$ 1,356	(1,356)
Issued pursuant to exercise of stock options (in Shares)		126,859
Other comprehensive income (loss) (note 6)	3,548				3,548
Balance at Sep. 30, 2024	$ 797,807	$ 1,441,814	$ 188,442	$ (833,785)	$ 1,336
Balance (in Shares) at Sep. 30, 2024		75,794,409

Basis of Presentation

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Basis of Presentation

Basis of presentation:

These unaudited interim consolidated financial statements are presented in U.S. dollars and include the accounts of the Company and its wholly-owned subsidiary, Xenon Pharmaceuticals USA Inc., a Delaware corporation. All intercompany transactions and balances have been eliminated on consolidation.

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these consolidated financial statements do not include all of the information and footnotes required for complete consolidated financial statements and should be read in conjunction with the audited consolidated financial statements and notes for the year ended December 31, 2023 included in the Company’s 2023 Annual Report on Form 10-K filed with the SEC and with the securities commissions in British Columbia, Alberta and Ontario on February 29, 2024.

These unaudited interim consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods presented. The results of operations for the three and nine month periods ended September 30, 2024 and 2023 are not necessarily indicative of results that can be expected for a full year. These unaudited interim consolidated financial statements follow the same significant accounting policies as those described in the notes to the audited consolidated financial statements of the Company included in the Company’s 2023 Annual Report on Form 10-K for the year ended December 31, 2023, with the exception of the policy described in note 3 below.

Correction of prior period error

During the quarter ended September 30, 2024, the Company determined that accretion of discounts on marketable securities was incorrectly presented within proceeds from marketable securities as part of net cash provided by investing activities on the consolidated statements of cash flows. As a result, a correction was made to the prior period to reclassify the amount of accretion of discounts on marketable securities within net cash used in operating activities, resulting in an increase in net cash used in operating activities and an increase in net cash provided by investing activities of $5,849 from the amounts that were previously reported. The Company evaluated the materiality of the presentation error, both quantitatively and qualitatively, and concluded it was not material to the consolidated financial statements for any prior period. These presentation changes had no effect on the previously reported consolidated balance sheets, consolidated statements of operations and comprehensive loss, or consolidated statements of shareholders’ equity.

Share Capital

9 Months Ended

Sep. 30, 2024

Stockholders' Equity Note [Abstract]

Share Capital

Share capital:

(a)

Financing:

In August 2020, the Company entered into an “at-the-market” equity offering sales agreement, amended as of March 2022, with Jefferies LLC and Stifel, Nicolaus & Company, Incorporated pursuant to which the Company may sell common shares from time to time (the "ATM Program"). In September 2023, pursuant to a prospectus supplement filed in March 2022 (“March 2022 Prospectus”), the Company sold an aggregate of 855,685 common shares for proceeds of $29,508, net of commissions and transaction expenses.

In August 2024, a prospectus supplement was filed replacing the March 2022 Prospectus, pursuant to which the Company refreshed the ATM Program and may sell common shares having gross proceeds of up to $350,000, from time to time. No common shares had been sold under the ATM Program during the nine months ended September 30, 2024.

(b)

Pre-funded warrants:

The following table summarizes the pre-funded warrants activity for the three and nine months ended September 30, 2024 and 2023:


	Three Months Ended September 30,					Nine Months Ended September 30,
	2024		2023			2024		2023
Outstanding, beginning of period		2,173,081		2,253,858			2,173,081		3,103,864
Exercised (1)		—		(425,004	)		—		(1,275,010	)
Outstanding, end of period		2,173,081		1,828,854			2,173,081		1,828,854

(1)

During the nine months ended September 30, 2023, the Company issued 1,275,000 common shares upon the exercise of 1,275,010 pre-funded warrants pursuant to a net exercise mechanism under the warrants.

Each pre-funded warrant is exercisable for the purchase of a common share at the holder's discretion at an exercise price of $0.0001, subject to certain post-exercise beneficial ownership limitations as provided under the terms of the pre-funded warrant. Pre-funded warrants to purchase 2,173,081 (September 30, 2023 – 1,828,854) common shares are not included in the number of issued and outstanding common shares as of September 30, 2024.

(c)

Stock-based compensation:

Stock Options

The following table presents stock option activity for the nine months ended September 30, 2024 and 2023:


	Nine Months Ended September 30,
	2024			Weighted Average Exercise Price ($)		2023			Weighted Average Exercise Price ($)
Outstanding, beginning of period		8,894,502			23.56		7,117,782			18.75
Granted		2,854,719			43.08		2,457,173			35.30
Exercised(1)		(627,662	)		13.81		(398,097	)		11.21
Forfeited, cancelled or expired		(108,180	)		37.53		(170,617	)		31.27
Outstanding, end of period		11,013,379			29.04		9,006,241			23.36
Exercisable, end of period		5,975,121			21.00		4,618,002			15.71

(1)

During the nine months ended September 30, 2024, the Company issued 423,432 (2023 – 283,863) common shares for the cashless exercise of 627,662 (2023 – 398,097) stock options.

The fair value of each stock option granted is estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:


	Nine Months Ended September 30,
	2024			2023
Average risk-free interest rate		4.05	%		3.91	%
Expected volatility		66	%		69	%
Average expected term (in years)		5.82			5.99
Expected dividend yield		0	%		0	%
Weighted average fair value of stock options granted	$	26.72		$	22.59

Performance Share Units

During the nine months ended September 30, 2024, the Company granted 210,000 PSUs to officers and certain employees. The vesting conditions, vesting period and expiry of the PSUs are determined by the board of directors, subject to the terms of the Amended and Restated 2014 Equity Incentive Plan. PSUs vest upon the achievement of certain predefined company-specific performance-based criteria on or before December 31, 2027, subject to continued employment to each performance objective achievement date. No PSUs vested during the nine months ended September 30, 2024.

- Definition

The entire disclosure for equity.

+ References

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+ Details

Significant Accounting Policies	9 Months Ended
Significant Accounting Policies	Sep. 30, 2024
Accounting Policies [Abstract]
Significant Accounting Policies	3. Significant accounting policies: Stock-based compensation: The Company grants performance share unit awards (“PSUs”) to certain employees and officers. PSUs vest upon the achievement of certain predefined company-specific performance-based criteria. PSUs are measured at the closing market price of the Company’s common shares on the date of grant. Stock-based compensation expense for PSUs is amortized on a straight-line basis over the requisite service period of each separately vesting tranche of the award once it is probable that the performance condition will be achieved.