Zymeworks Inc. (NYSE: ZYME), a clinical-stage biopharmaceutical
company developing multifunctional biotherapeutics, today reported
financial results for the second quarter ended June 30, 2021.
“The second half of 2021 is an exciting time at Zymeworks as we
prepare to present important data readouts at upcoming medical
conferences in support of the planned launch of our pivotal trial
for zanidatamab in first-line HER2-positive gastric cancer,” said
Ali Tehrani, Ph.D., Zymeworks’ President & CEO. “The first data
presentation will be at the European Society for Medical Oncology
(ESMO) meeting in September and highlights results from our Phase 2
clinical trial evaluating zanidatamab plus chemotherapy in
first-line gastric cancer, a setting where the current standard of
care is Herceptin® plus chemotherapy. These results will be
integral to our goal of establishing zanidatamab as the new
foundational HER2-targeted therapy and bring us one step closer to
realizing our mission of enabling patients to return home to their
loved ones, disease free.”
Second Quarter 2021 Business Highlights and Recent
Developments
- Zanidatamab in First-Line Gastroesophageal Adenocarcinoma
(GEA) to be Presented at ESMO Annual Meeting The presentation
will feature new clinical data for our lead product candidate,
zanidatamab, in combination with chemotherapy, as a first-line
treatment for patients with HER2-positive GEA. The presentation
will be available on Thursday, September 16 at 8:30 AM CEST
(Central European Summer Time) on both the ESMO and Zymeworks
websites.
- Enrollment Initiated for First-Line Biliary Tract Cancer and
Colorectal Cancer Cohorts in Zanidatamab Phase 2 Clinical Trial
The ongoing Phase 2 study is evaluating zanidatamab in combination
with standard of care chemotherapy as a first-line treatment for
patients with unresectable, locally advanced, recurrent or
metastatic HER2-expressing gastrointestinal cancers including
biliary tract cancer, colorectal cancer, and GEA. Results from this
study are expected to inform future potential pivotal trials.
- First Patient Dosed with Zanidatamab in Combination with
Tukysa® (Tucatinib) and Chemotherapy in Advanced HER2-Positive
Breast Cancer The first patient has been dosed in a new cohort
of a Phase 1 trial investigating the safety, tolerability, and
efficacy of zanidatamab in combination with tucatinib and
capecitabine. This new cohort will evaluate HER2-positive breast
cancer patients with locally advanced (unresectable) and/or
metastatic disease that have received prior therapy with
trastuzumab, pertuzumab and T-DM1.
- First Patient Dosed for Janssen-Developed Bispecific
Antibody Utilizing Zymeworks' Azymetric™ and EFECT™ Therapeutic
Platforms The new bispecific antibody developed by Janssen,
JNJ-78278343, represents Zymeworks’ fourth pharmaceutical
partnership with programs reaching clinical development. Zymeworks
will receive a payment in connection with this milestone under
Zymeworks’ 2017 licensing agreement with Janssen.
- ZW49 Cohort Expansion Study Opens New Sites in South Korea
and Australia Zymeworks has opened new sites in South Korea and
Australia to accelerate the cohort expansion portion of the Phase 1
clinical trial for ZW49. This will support Zymeworks' goal of
identifying the recommended Phase 2 dose and schedule by the end of
this year. Dose escalation continues in weekly and once every three
week schedules while three indication-specific expansion cohorts
utilizing the 2.5 mg/kg once every three week regimen are
ongoing.
Financial Results for the Quarter Ended June 30, 2021
Zymeworks’ revenue relates primarily to non-recurring upfront
fees, expansion payments or milestone payments from collaboration
and license agreements, which can vary in timing and amount from
period to period, as well as research support and other payments.
Revenue for the three months ended June 30, 2021 was $1.8 million
compared to $12.4 million for the same period of 2020. Revenue for
the second quarter of 2021 related to research support and other
payments from our partners. Revenue for the same period in 2020
included recognition of a $12.0 million expansion fee resulting
from an amendment to our collaboration agreement with BMS, as well
as $0.4 million in research support and other payments from our
partners.
For the three months ended June 30, 2021, research and
development expenses were $50.7 million compared to $39.8 million
for the same period of 2020. The increase was primarily due to
higher salaries and benefits expense from additional headcount as
well as higher stock-based compensation expense and third-party
research and development program expenses. For the three months
ended June 30, 2021, research and development expenses included
non-cash stock-based compensation expense of $5.8 million from
equity-classified equity awards and $0.2 million from the non-cash
mark-to-market revaluation of certain historical liability
classified equity awards. Excluding stock-based compensation
expense, research and development expenses increased by $8.1
million for the three months ended June 30, 2021 compared to the
same period in 2020.
For the three months ended June 30, 2021, general and
administrative expenses were $19.9 million compared to $12.9
million for the same period in 2020. The increase was primarily due
to higher salaries and benefits due to additional headcount,
stock-based compensation expense and professional fees. For the
three months ended June 30, 2021, general and administrative
expenses included non-cash stock-based compensation expense of $5.3
million from equity-classified equity awards and $1.5 million from
the non-cash mark-to-market revaluation of certain historical
liability-classified equity awards. Excluding stock-based
compensation expense, general and administrative expenses increased
by $3.9 million for the three months ended June 30, 2021 compared
to the same period in 2020.
Net loss for the three months ended June 30, 2021 was $67.5
million compared to $39.0 million for the same period of 2020. This
was primarily due to the decrease in revenue and interest income
and increase in research and development and general and
administrative expenses referred to above.
Zymeworks expects research and development expenditures to
increase over time in line with the advancement and expansion of
the Company’s clinical development of its product candidates, as
well as its ongoing preclinical research activities. Additionally,
Zymeworks anticipates continuing to receive revenue from its
existing and future strategic partnerships, including technology
access fees and milestone-based payments. However, Zymeworks’
ability to receive these payments is dependent upon either
Zymeworks or its collaborators successfully completing specified
research and development activities.
As of June 30, 2021, Zymeworks had $359.8 million in cash
resources consisting of cash, cash equivalents and short-term
investments. We anticipate this will enable us to fund our planned
operations into the second half of 2022 and potentially beyond.
About Zymeworks Inc.
Zymeworks is a clinical-stage biopharmaceutical company
dedicated to the development of next-generation multifunctional
biotherapeutics. Zymeworks’ suite of therapeutic platforms and its
fully integrated drug development engine enable precise engineering
of highly differentiated product candidates. Zymeworks’ lead
clinical candidate, zanidatamab (ZW25), is a novel Azymetric™
bispecific antibody which has been granted Breakthrough Therapy
designation by the FDA and is currently enrolling in a pivotal
clinical trial for refractory HER2-amplified biliary tract cancer
(HERIZON-BTC-01) as well as several Phase 2 clinical trials for
HER2-expressing gastroesophageal, colorectal, and breast cancers.
Zymeworks’ second clinical candidate, ZW49, is a novel bispecific
HER2-targeting antibody-drug conjugate currently in Phase 1
clinical development and combines the unique design and antibody
framework of zanidatamab with Zymeworks’ proprietary ZymeLink™
linker and cytotoxin. Zymeworks is also advancing a deep
preclinical pipeline in oncology (including immuno-oncology agents)
and other therapeutic areas. In addition, its therapeutic platforms
are being leveraged through strategic partnerships with nine
biopharmaceutical companies. For additional information about
Zymeworks, visit www.zymeworks.com and follow @ZymeworksInc on
Twitter.
Cautionary Note Regarding Forward-Looking Statements
This press release includes “forward-looking statements” within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995 and “forward-looking information” within the meaning of
Canadian securities laws, or collectively, forward-looking
statements. Forward-looking statements in this news release
include, but are not limited to, statements that relate to
Zymeworks’ clinical development of its product candidates, related
clinical trials, anticipated clinical data presentations, potential
therapeutic effects of zanidatamab, expected increases in research
and development expenditures, anticipated continued receipt of
revenue from existing and future partners, Zymeworks’ preclinical
pipeline, anticipated sufficiency of cash resources to fund
Zymeworks’ planned operations into the second half of 2022 and
potentially beyond, and other information that is not historical
information. When used herein, words such as “plan”, “expect”,
“may”, “continue”, “anticipate”, “potential”, “will”, and similar
expressions are intended to identify forward-looking statements. In
addition, any statements or information that refer to expectations,
beliefs, plans, projections, objectives, performance or other
characterizations of future events or circumstances, including any
underlying assumptions, are forward-looking. All forward-looking
statements are based upon Zymeworks’ current expectations and
various assumptions. Zymeworks believes there is a reasonable basis
for its expectations and beliefs, but they are inherently
uncertain. Zymeworks may not realize its expectations, and its
beliefs may not prove correct. Actual results could differ
materially from those described or implied by such forward-looking
statements as a result of various factors, including, without
limitation, market conditions and the factors described under “Risk
Factors” in Zymeworks’ Quarterly Report on Form 10-Q for its
quarter ended June 30, 2021 (a copy of which may be obtained at
www.sec.gov and www.sedar.com). Consequently, forward-looking
statements should be regarded solely as Zymeworks’ current plans,
estimates and beliefs. Investors should not place undue reliance on
forward-looking statements. Zymeworks cannot guarantee future
results, events, levels of activity, performance or achievements.
Zymeworks does not undertake and specifically declines any
obligation to update, republish, or revise any forward-looking
statements to reflect new information, future events or
circumstances or to reflect the occurrences of unanticipated
events, except as may be required by law.
ZYMEWORKS INC. Condensed Interim
Consolidated Statements of Loss (Expressed in thousands of U.S.
dollars except share and per share data) (unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2021
2020
2021
2020
Revenue
Research and development
collaborations
$
1,771
$
12,359
$
2,415
$
20,628
Operating expenses:
Research and development
50,711
39,784
94,994
76,727
General and administrative
19,945
12,924
21,241
20,130
Total operating expenses
70,656
52,708
116,235
96,857
Loss from operations
(68,885
)
(40,349
)
(113,820
)
(76,229
)
Other income, net
929
1,324
1,799
6,443
Loss before income taxes
(67,956
)
(39,025
)
(112,021
)
(69,786
)
Income tax expense
434
64
(91
)
(311
)
Net loss and comprehensive loss
$
(67,522
)
$
(38,961
)
$
(112,112
)
$
(70,097
)
Net loss per common share:
Basic
$
(1.31
)
$
(0.77
)
$
(2.18
)
$
(1.41
)
Diluted
$
(1.31
)
$
(0.77
)
$
(2.42
)
$
(1.41
)
Weighted-average common shares
outstanding:
Basic
51,422,066
50,788,681
51,395,015
49,737,699
Diluted
51,422,066
50,788,681
52,068,506
49,737,699
ZYMEWORKS INC. Selected Condensed
Consolidated Balance Sheet Data (Expressed in thousands of U.S.
dollars)
June 30, 2021
December 31,
2020
(unaudited)
Cash, cash equivalents, short-term
investments and certain long-term investments
$
359,811
$
451,557
Working capital
309,952
369,410
Total assets
471,954
538,376
Accumulated deficit
(583,373
)
(471,261
)
Total shareholders’ equity
321,472
409,922
NON-GAAP FINANCIAL MEASURES
In addition to reporting financial information in accordance
with U.S. generally accepted accounting principles (“GAAP”) in this
press release, Zymeworks is also reporting normalized expenses and
normalized loss per share, which are non-GAAP financial measures.
Normalized expenses and normalized loss per share are not defined
by GAAP and should not be considered as alternatives to net loss,
net loss per share or any other indicator of Zymeworks’ performance
required to be reported under GAAP. In addition, Zymeworks’
definitions of normalized expenses and normalized loss per share
may not be comparable to similarly titled non-GAAP measures
presented by other companies. Investors and others are encouraged
to review Zymeworks’ financial information in its entirety and not
rely on a single financial measure. As defined by Zymeworks,
normalized expenses represent total research and development
expenses and general and administrative expenses adjusted for
non-cash stock-based compensation expenses for equity and liability
classified equity instruments.
Normalized expenses are a non-GAAP measure that Zymeworks
believes is useful because it excludes those items that Zymeworks
believes are not representative of Zymeworks’ operating
expenses.
GAAP to Non-GAAP Reconciliations
(Expressed in thousands of U.S. dollars except share and per share
data) (unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2021
2020
2021
2020
Research and development expenses
$
50,711
$
39,784
$
94,994
$
76,727
Stock-based compensation for equity
classified instruments
(5,790
)
(3,346
)
(10,126
)
(5,496
)
Stock-based compensation for liability
classified instruments
(245
)
107
2,268
1,900
Normalized research and development
expenses (Non-GAAP basis)
$
44,676
$
36,545
$
87,136
$
73,131
General and administrative expenses
$
19,945
$
12,924
$
21,241
$
20,130
Stock-based compensation for equity
classified instruments
(5,296
)
(4,046
)
(9,488
)
(6,497
)
Stock-based compensation for liability
classified instruments
(1,545
)
310
11,406
5,799
Normalized general and administrative
expenses (Non-GAAP basis)
$
13,104
$
9,188
$
23,159
$
19,432
Net loss per common share – Basic
$
(1.31
)
$
(0.77
)
$
(2.18
)
$
(1.41
)
Stock based compensation for equity
classified instruments
0.22
0.15
0.38
0.24
Stock based compensation for liability
classified instruments
0.03
(0.01
)
(0.27
)
(0.15
)
Normalized net loss per common share –
Basic (Non-GAAP basis)
$
(1.06
)
$
(0.63
)
$
(2.07
)
$
(1.32
)
Net loss per common share – Diluted
$
(1.31
)
$
(0.77
)
$
(2.42
)
$
(1.41
)
Stock based compensation for equity
classified instruments
0.22
0.15
0.38
0.24
Stock based compensation for liability
classified instruments
0.03
(0.01
)
(0.26
)
(0.15
)
Normalized net loss per common share –
Diluted (Non-GAAP basis)
$
(1.06
)
$
(0.63
)
$
(2.30
)
$
(1.32
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210804006023/en/
Investor Inquiries: Ryan Dercho, Ph.D. (604) 678-1388
ir@zymeworks.com
Jack Spinks (604) 678-1388 ir@zymeworks.com
Media Inquiries: Mary Klem (604) 678-1388
media@zymeworks.com
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