Zynerba Pharmaceuticals, Inc. (Nasdaq: ZYNE), the leader in
innovative pharmaceutically-produced transdermal cannabinoid
therapies for orphan neuropsychiatric disorders, today reported
financial results for the second quarter ended June 30, 2022, and
provided an overview of recent operational highlights and a
pipeline update.
“During the second quarter, we were pleased to announce positive
topline results from our Phase 2 trial of Zygel in patients with
22q. In addition to further progressing 22q, we are focused on
completing the Phase 3 RECONNECT trial for children and adolescents
with Fragile X syndrome, with topline results expected in the
second half of 2023,” said Armando Anido, Chairman and Chief
Executive Officer of Zynerba. “With a cash runway extending past
expected availability of topline results from our RECONNECT trial,
we remain well-positioned on achieving our goal of bringing the
first pharmaceutical product indicated for the treatment of
behavioral symptoms of Fragile X syndrome to market.”
Operational Highlights and Pipeline Update
Zygel in Fragile X Syndrome (FXS)
- The Company continues to expect topline results from RECONNECT,
a confirmatory pivotal Phase 3 trial of Zygel in patients with FXS,
in the second half of 2023. The Company believes that the results
from RECONNECT, if positive, will be sufficient to support the
submission of a New Drug Application (NDA) for Zygel in patients
with FXS.
- Presented data at the 18th NFXF International Fragile X
Conference in July and the American Society of Clinical
Psychopharmacology Annual Meeting in June demonstrating that in the
long-term safety and efficacy study of Zygel in children and
adolescents with FXS, improvement was seen in Social Avoidance in
the full population, with the greatest improvement in patients with
complete methylation of the FMR1 gene. Patients with complete
methylation, who match the primary efficacy population in the
ongoing confirmatory trial, RECONNECT, achieved and maintained
clinically meaningful change in Social Avoidance, supporting one of
the key design enhancements for RECONNECT. Zygel was well-tolerated
during long-term administration up to 38 months of exposure.
(Poster and Presentation)
- Presented data at the 18th NFXF International Fragile X
Conference in July and the American Society of Clinical
Psychopharmacology Annual Meeting in June describing how learnings
from CONNECT-FX, the first randomized, double-blind,
placebo-controlled trial of Zygel in the treatment of FXS, shaped
the design of RECONNECT. In addition to the primary endpoint of the
RECONNECT trial being measured in patients who have a completely
methylated FMR1 gene, the treatment period of the trial has been
extended by four weeks and an additional weight-based dose has been
added for participants weighing greater than 50kg. RECONNECT is
expected to provide key data to determine the effectiveness of
Zygel in FXS while using a design intended to reduce the burden of
participation in a clinical trial for families with children and
adolescents with FXS. (Poster)
Zygel in 22q11.2 Deletion Syndrome (22q)
- In June, the Company announced positive topline results from
the exploratory, open label Phase 2 INSPIRE trial of Zygel in
children and adolescents with 22q. The INSPIRE trial achieved
statistically significant and clinically meaningful improvements
from baseline in multiple efficacy assessments. Zygel was shown to
be well tolerated, and the safety profile was consistent with
previously released data from other Zygel clinical trials. (Press
Release)
- Based on the positive Phase 2 data, the Company plans to meet
with the U.S. Food and Drug Administration (FDA) to discuss the
data and the regulatory path forward. The Company plans to move
forward in 22q as an orphan indication and has previously received
orphan drug designation from the FDA for cannabidiol, the active
ingredient in Zygel, for the treatment of 22q.
Zygel in Autism Spectrum Disorder (ASD)
- As previously disclosed, while data from the Company’s ASD
clinical development program to date are compelling, given the
difficult financing market, the Company has deferred the start of
the Phase 3 development program in ASD as it has prioritized its
resources on FXS and 22q in the near term.
Second Quarter 2022 Financial Results
Research and development expenses were $5.4 million for the
second quarter of 2022, including stock-based compensation of $0.5
million. General and administrative expenses were $3.7 million in
the second quarter of 2022, including stock-based compensation
expense of $0.6 million. Net loss for the second quarter of 2022
was $9.9 million, with basic and diluted loss per share of
$(0.24).
Financial Outlook
As of June 30, 2022, cash and cash equivalents were $62.5
million, compared to $67.8 million as of December 31, 2021.
On May 11, 2021, the Company entered into a Controlled Equity
OfferingSM Sales Agreement, or the 2021 Sales Agreement”, with
Cantor Fitzgerald & Co., Canaccord Genuity, LLC, H.C.
Wainwright & Co. LLC and Ladenburg Thalmann & Co. Inc., as
sales agents, pursuant to which the Company may sell, from time to
time, up to $75.0 million of its common stock. In the second
quarter of 2022, the Company sold and issued 488,892 shares of its
common stock under the 2021 Sales Agreement in the open market
resulting in gross proceeds of $0.9 million and net proceeds of
$0.8 million, after deducting commissions and offering expenses.
From July 1, 2022 through August 8, 2022, the Company sold and
issued 1,469,714 shares of its common stock under the 2021 Sales
Agreement in the open market resulting in gross proceeds of $1.8
million, and net proceeds of $1.6 after deducting commissions and
offering expenses
On July 21, 2022, the Company entered into an equity purchase
agreement for up to $20 million with Lincoln Park Capital Fund, LLC
(LPC), a Chicago-based institutional investor. Under the terms of
the agreement, Zynerba will have the right in its sole discretion,
but not the obligation, to sell to LPC shares of its common stock
over the 36-month term of the agreement. Zynerba controls the
timing and amount of any future sales of its shares of common stock
and LPC is obligated to make purchases in accordance with the terms
of the purchase agreement, subject to various limitations including
those under the Nasdaq listing rules.
Management believes that the Company’s cash and cash equivalents
are sufficient to fund operations and capital requirements through
the end of 2023 or into early 2024, after the expected availability
of topline results from its confirmatory pivotal Phase 3 RECONNECT
trial of Zygel in patients with FXS.
About Zygel
Zygel is the first and only pharmaceutically-manufactured
cannabidiol formulated as a patent-protected permeation-enhanced
clear gel, designed to provide controlled drug delivery into the
bloodstream transdermally (i.e. through the skin). Recent studies
suggest that cannabidiol may modulate the endocannabinoid system
and improve certain behavioral symptoms associated with
neuropsychiatric conditions. Zygel is an investigational drug
product in development for the potential treatment of behavioral
symptoms associated with Fragile X syndrome (FXS), 22q11.2 deletion
syndrome (22q) and autism spectrum disorder (ASD). The Company has
received orphan drug designation for cannabidiol, the active
ingredient in Zygel, from the FDA and the European Commission in
the treatment of FXS and by the FDA for the treatment of 22q.
Additionally, Zygel has been designated a Fast Track development
program for treatment of behavioral symptoms of FXS.
About Zynerba Pharmaceuticals, Inc.
Zynerba Pharmaceuticals is the leader in innovative
pharmaceutically-produced transdermal cannabinoid therapies for
rare and near-rare neuropsychiatric disorders. We are committed to
improving the lives of patients and their families living with
severe, chronic health conditions including Fragile X syndrome,
22q11.2 deletion syndrome and autism spectrum disorder. Learn more
at www.zynerba.com and follow us on Twitter at
@ZynerbaPharma.
Cautionary Note on Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of The Private Securities Litigation Reform Act of
1995. We may, in some cases, use terms such as “predicts,”
“believes,” “potential,” “proposed,” “continue,” “estimates,”
“anticipates,” “expects,” “plans,” “intends,” “may,” “could,”
“might,” “will,” “should” or other words that convey uncertainty of
future events or outcomes to identify these forward-looking
statements. Such statements are subject to numerous important
factors, risks and uncertainties that may cause actual events or
results to differ materially from the Company’s current
expectations. Management’s expectations and, therefore, any
forward-looking statements in this press release could also be
affected by risks and uncertainties relating to a number of other
factors, including the following: the Company’s cash and cash
equivalents may not be sufficient to support its operating plan for
as long as anticipated; the Company’s expectations, projections and
estimates regarding expenses, future revenue, capital requirements,
incentive and other tax credit eligibility, collectability and
timing, and availability of and the need for additional financing;
the Company’s ability to obtain additional funding to support its
clinical development programs; the results, cost and timing of the
Company’s clinical development programs, including any delays to
such clinical trials relating to enrollment or site initiation;
clinical results for the Company’s product candidates may not be
replicated or continue to occur in additional trials and may not
otherwise support further development in a specified indication or
at all; actions or advice of the U.S. Food and Drug Administration
and foreign regulatory agencies may affect the design, initiation,
timing, continuation and/or progress of clinical trials or result
in the need for additional clinical trials; the Company’s ability
to obtain and maintain regulatory approval for its product
candidates, and the labeling under any such approval; the Company’s
reliance on third parties to assist in conducting pre-clinical and
clinical trials for its product candidates; delays, interruptions
or failures in the manufacture and supply of the Company’s product
candidates the Company’s ability to commercialize its product
candidates; the size and growth potential of the markets for the
Company’s product candidates, and the Company’s ability to service
those markets; the Company’s ability to develop sales and marketing
capabilities, whether alone or with potential future collaborators;
the rate and degree of market acceptance of the Company’s product
candidates; the Company’s expectations regarding its ability to
obtain and adequately maintain sufficient intellectual property
protection for its product candidates; the extent to which health
epidemics and other outbreaks of communicable diseases, including
COVID-19, could disrupt our operations or adversely affect our
business and financial conditions; and the extent to which
inflation or global instability, including political instability,
may disrupt our business operations or our financial condition.
This list is not exhaustive and these and other risks are described
in the Company’s periodic reports, including the annual report on
Form 10-K, quarterly reports on Form 10-Q and current reports on
Form 8-K, filed with or furnished to the Securities and Exchange
Commission and available at www.sec.gov. Any forward-looking
statements that the Company makes in this press release speak only
as of the date of this press release. The Company assumes no
obligation to update forward-looking statements whether as a result
of new information, future events or otherwise, after the date of
this press release.
|
ZYNERBA PHARMACEUTICALS, INC. |
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
|
|
|
|
(unaudited) |
|
|
Three months ended June 30, |
|
Six month ended June 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Research and development |
|
$ |
5,446,317 |
|
|
$ |
5,451,948 |
|
|
$ |
10,592,922 |
|
|
$ |
10,060,958 |
|
General and administrative |
|
|
3,722,453 |
|
|
|
4,386,546 |
|
|
|
7,479,763 |
|
|
|
7,662,343 |
|
Total operating expenses |
|
|
9,168,770 |
|
|
|
9,838,494 |
|
|
|
18,072,685 |
|
|
|
17,723,301 |
|
Loss from operations |
|
|
(9,168,770 |
) |
|
|
(9,838,494 |
) |
|
|
(18,072,685 |
) |
|
|
(17,723,301 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
Interest income |
|
|
91,691 |
|
|
|
5,943 |
|
|
|
187,735 |
|
|
|
11,576 |
|
Foreign exchange gain (loss) |
|
|
(775,927 |
) |
|
|
(117,528 |
) |
|
|
(458,675 |
) |
|
|
(199,982 |
) |
Total other income (expense) |
|
|
(684,236 |
) |
|
|
(111,585 |
) |
|
|
(270,940 |
) |
|
|
(188,406 |
) |
Net loss |
|
$ |
(9,853,006 |
) |
|
$ |
(9,950,079 |
) |
|
$ |
(18,343,625 |
) |
|
$ |
(17,911,707 |
) |
|
|
|
|
|
|
|
|
|
Net loss per share - basic and diluted |
|
$ |
(0.24 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.45 |
) |
|
$ |
(0.47 |
) |
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average shares outstanding |
|
|
41,406,803 |
|
|
|
40,065,715 |
|
|
|
40,858,688 |
|
|
|
38,344,145 |
|
|
|
|
|
|
|
|
|
|
Non-cash stock-based compensation included above: |
|
|
|
|
|
|
|
|
Research and development |
|
$ |
488,645 |
|
|
$ |
1,005,886 |
|
|
$ |
1,018,141 |
|
|
$ |
1,625,277 |
|
General and administrative |
|
|
619,898 |
|
|
|
928,463 |
|
|
|
1,250,884 |
|
|
|
1,573,909 |
|
Total |
|
$ |
1,108,543 |
|
|
$ |
1,934,349 |
|
|
$ |
2,269,025 |
|
|
$ |
3,199,186 |
|
|
|
|
|
|
|
|
|
|
ZYNERBA PHARMACEUTICALS, INC.CONSOLIDATED
BALANCE SHEETS |
|
|
|
|
|
|
|
(unaudited) |
|
|
|
|
June 30, 2022 |
|
December 31, 2021 |
Assets |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
62,489,635 |
|
|
$ |
67,808,000 |
|
Incentive and tax receivables |
|
|
1,474,328 |
|
|
|
9,580,468 |
|
Prepaid expenses and other current assets |
|
|
1,707,738 |
|
|
|
2,831,392 |
|
Total current assets |
|
|
65,671,701 |
|
|
|
80,219,860 |
|
Property and equipment, net |
|
|
322,713 |
|
|
|
385,833 |
|
Incentive and tax receivables |
|
|
560,745 |
|
|
|
— |
|
Right-of-use assets |
|
|
451,800 |
|
|
|
565,814 |
|
Total assets |
|
$ |
67,006,959 |
|
|
$ |
81,171,507 |
|
Liabilities and Stockholders' Equity |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
1,674,841 |
|
|
$ |
1,798,813 |
|
Accrued expenses |
|
|
7,640,866 |
|
|
|
7,896,598 |
|
Lease liabilities |
|
|
211,965 |
|
|
|
209,068 |
|
Total current liabilities |
|
|
9,527,672 |
|
|
|
9,904,479 |
|
Lease liabilities, long-term |
|
|
237,414 |
|
|
|
353,694 |
|
Total liabilities |
|
|
9,765,086 |
|
|
|
10,258,173 |
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
Common stock |
|
|
43,936 |
|
|
|
41,218 |
|
Additional paid-in capital |
|
|
315,023,041 |
|
|
|
310,353,595 |
|
Accumulated deficit |
|
|
(257,825,104 |
) |
|
|
(239,481,479 |
) |
Total stockholders' equity |
|
|
57,241,873 |
|
|
|
70,913,334 |
|
Total liabilities and stockholders' equity |
|
$ |
67,006,959 |
|
|
$ |
81,171,507 |
|
|
|
|
|
|
Zynerba Contacts
Jim Fickenscher, CFO and VP Corporate DevelopmentZynerba
Pharmaceuticals484.581.7483fickenscherj@zynerba.com
Peter VozzoICR WestwickeOffice: 443.213.0505Cell:
443.377.4767Peter.Vozzo@Westwicke.com
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