Zynerba Pharmaceuticals, Inc. (Nasdaq: ZYNE), the leader in
innovative pharmaceutically-produced transdermal cannabinoid
therapies for orphan neuropsychiatric disorders, today reported
financial results for the fourth quarter and full year ended
December 31, 2022, and provided an overview of recent operational
highlights and a pipeline update.
“We remain focused on enrolling patients in our confirmatory
pivotal Phase 3 RECONNECT trial, and expect topline results in the
first half of 2024,” said Armando Anido, Chairman and Chief
Executive Officer of Zynerba. “We are committed to bringing the
first pharmaceutical product indicated for the treatment of
behavioral symptoms of Fragile X syndrome to market, and with a
cash runway to mid-year 2024, we remain well-positioned on
achieving that goal.”
Operational Highlights and Pipeline Update
Zygel in Fragile X Syndrome (FXS)
- The Company expects topline results
from RECONNECT, a confirmatory pivotal Phase 3 trial of Zygel in
patients with FXS, in the first half of 2024. The Company believes
that the results from RECONNECT, if positive, will be sufficient to
support the submission of a New Drug Application (NDA) in the U.S.
and a Marketing Authorization Application (MAA) in Europe for Zygel
in patients with FXS.
- Published data in the Journal of
Neurodevelopmental Disorders describing the role of the
endocannabinoid system and cannabidiol therapy in FXS. The review
of evidence suggests a central role for the endocannabinoid system
in neuronal development and cognitive function and in the
pathogenesis of FXS, and the potential role of cannabidiol as a
treatment for FXS. (Press Release).
- Published data from the Phase 3
CONNECT-FX study of Zygel in the Journal of Neurodevelopmental
Disorders. The Phase 3 study demonstrated that patients with FXS
who have a highly methylated FMR1 gene that were treated with Zygel
showed a significant reduction in behavioral symptoms compared to
those treated with placebo, and that Zygel was well tolerated.
(Press Release).
- The Company announced that the U.S.
Patent and Trademark Office (USPTO) issued a patent titled
“Treatment of Fragile X Syndrome With Cannabidiol,” which includes
claims directed to methods of treating FXS with cannabidiol. This
new patent, which expires in 2038, is part of an expanding
international intellectual property portfolio covering Zygel.
(Press Release)
Zygel in 22q11.2 Deletion Syndrome (22q)
- Based on the positive Phase 2
INSPIRE trial data announced in June 2022 (Press Release), the
Company held an initial meeting with the U.S. Food and Drug
Administration (FDA) in the fourth quarter of 2022 to obtain
feedback on the Phase 2 data and regulatory pathway for Zygel in
patients with 22q. The Company expects to continue its productive
dialogue with the FDA on this topic and arrive at an acceptable
trial design by the end of 2023. The Company currently plans to
initiate a Phase 3 program in children and adolescents with 22q
following topline results from RECONNECT.
- In November 2022, the Company
announced that the European Commission granted orphan drug
designation to cannabidiol, the active ingredient in Zygel, for the
treatment of 22q.
- The Company presented positive
long-term 38-week data from the Phase 2 INSPIRE trial with Zygel in
children and adolescents with 22q at the 61st Annual Meeting of the
American College of Neuropsychopharmacology. The data showed that
through 38-weeks of treatment, sustained, statistically significant
improvements were seen in children and adolescents treated with
Zygel in the Pediatric Anxiety Rating Scale (PARS-R), all five
scales of the Anxiety, Depression and Mood Scale (ADAMS), and all
five subscales of the Aberrant Behavior Checklist – Community
(ABC-C). These results are consistent with the previously reported
14-week treatment data suggesting a positive risk-benefit profile
for Zygel in improving anxiety-related and behavioral symptoms in
children and adolescents with 22q when added to a stable standard
of care. (Press Release).
- During the fourth quarter of 2022,
the Company announced that the USPTO issued a patent titled
“Treatment of 22q11.2 Deletion Syndrome With Cannabidiol,” which
includes claims directed to methods of treating one or more
behavioral symptoms of 22q with cannabidiol, and expires in 2040.
(Press Release).
Fourth Quarter and Full Year 2022 Financial
Results
Research and development expenses were $5.5 million for the
fourth quarter of 2022, including stock-based compensation of $0.5
million. General and administrative expenses were $3.2 million in
the fourth quarter of 2022, including stock-based compensation
expense of $0.5 million. Net loss for the fourth quarter of 2022
was $8.0 million, with basic and diluted loss per share of
$(0.18).
Research and development expenses were $21.1 million for full
year 2022, including stock-based compensation of $2.0 million.
General and administrative expenses were $14.2 million for full
year 2022, including stock-based compensation expense of $2.4
million. Net loss for full year 2022 was $35.0 million, with basic
and diluted loss per share of $(0.82).
Financial Outlook
As of December 31, 2022, cash and cash equivalents were $50.6
million, compared to $67.8 million as of December 31, 2021. On
March 13, 2023, the Company issued a statement confirming that it
does not hold cash deposits or securities at Silicon Valley
Bank.
On May 11, 2021, the Company entered into a Controlled Equity
OfferingSM Sales Agreement (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. During the year ended December
31, 2022, the Company sold and issued 4,608,274 shares of its
common stock under the 2021 Sales Agreement in the open market
resulting in gross proceeds of $6.2 million and net proceeds of
$5.8 million, after deducting commissions and offering expenses.
From January 1, 2023 through March 22, 2023, the Company sold and
issued 1,179,077 shares of its common stock under the 2021 Sales
Agreement in the open market resulting in gross proceeds of $0.7
million and net proceeds of $0.6 million, after deducting
commissions and offering expenses.
On July 21, 2022, the Company entered into a Purchase Agreement
and registration rights agreement for up to $20 million with
Lincoln Park Capital Fund, LLC (LPC), a Chicago-based institutional
investor. During the year ended December 31, 2022, the Company sold
and issued 350,000 shares of its common stock under the 2022
Purchase Agreement with LPC in the open market resulting in gross
proceeds of $0.3 million and net proceeds of $0.2 million, after
deducting offering expenses. From January 1, 2023 through March 22,
2023, the Company sold and issued 1,950,000 shares of its common
stock under the Purchase Agreement, resulting in gross and net
proceeds of $1.0 million.
Management believes that the Company’s cash and cash equivalents
are sufficient to fund operations and capital requirements into
mid-year 2024. Top-line results from the Company’s confirmatory
pivotal Phase 3 RECONNECT trial of Zygel in patients with FXS are
expected in the first half of 2024.
About Zygel
Zygel is the first and only pharmaceutically-manufactured
cannabidiol formulated as a patent-protected permeation-enhanced
clear gel, designed to provide 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 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
orphan neuropsychiatric disorders. We are committed to improving
the lives of patients and their families living with severe,
chronic health conditions including Fragile X syndrome and 22q11.2
deletion syndrome. 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,
the European Medicines Agency and other 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 December 31, |
|
Year ended December 31, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Research and development |
|
$ |
5,467,516 |
|
|
$ |
5,022,360 |
|
|
$ |
21,099,666 |
|
|
$ |
21,424,489 |
|
|
General and administrative |
|
|
3,218,463 |
|
|
|
3,814,077 |
|
|
|
14,151,874 |
|
|
|
15,345,901 |
|
|
Total operating expenses |
|
|
8,685,979 |
|
|
|
8,836,437 |
|
|
|
35,251,540 |
|
|
|
36,770,390 |
|
|
Loss from operations |
|
|
(8,685,979 |
) |
|
|
(8,836,437 |
) |
|
|
(35,251,540 |
) |
|
|
(36,770,390 |
) |
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
Interest income |
|
|
407,270 |
|
|
|
4,433 |
|
|
|
846,860 |
|
|
|
21,047 |
|
|
Foreign exchange gain (loss) |
|
|
262,677 |
|
|
|
16,938 |
|
|
|
(631,126 |
) |
|
|
(559,681 |
) |
|
Total other income (expense) |
|
|
669,947 |
|
|
|
21,371 |
|
|
|
215,734 |
|
|
|
(538,634 |
) |
|
Net loss |
|
$ |
(8,016,032 |
) |
|
$ |
(8,815,066 |
) |
|
$ |
(35,035,806 |
) |
|
$ |
(37,309,024 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share - basic and diluted |
|
$ |
(0.18 |
) |
|
$ |
(0.22 |
) |
|
$ |
(0.82 |
) |
|
$ |
(0.95 |
) |
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted weighted average shares outstanding |
|
|
45,127,998 |
|
|
|
40,227,715 |
|
|
|
42,662,770 |
|
|
|
39,259,495 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash
stock-based compensation included above: |
|
|
|
|
|
|
|
|
|
Research and development |
|
$ |
472,447 |
|
|
$ |
384,304 |
|
|
$ |
1,972,894 |
|
|
$ |
2,827,971 |
|
|
General and administrative |
|
|
549,155 |
|
|
|
657,097 |
|
|
|
2,358,833 |
|
|
|
2,982,609 |
|
|
Total |
|
$ |
1,021,602 |
|
|
$ |
1,041,401 |
|
|
$ |
4,331,727 |
|
|
$ |
5,810,580 |
|
|
|
|
|
|
|
|
|
|
|
|
ZYNERBA
PHARMACEUTICALS, INC.CONSOLIDATED BALANCE
SHEETS |
|
|
|
December 31, 2022 |
|
December 31, 2021 |
|
Assets |
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
50,640,993 |
|
|
$ |
67,808,000 |
|
|
Incentive and tax receivables |
|
|
1,225,383 |
|
|
|
9,580,468 |
|
|
Prepaid expenses and other current assets |
|
|
2,908,731 |
|
|
|
2,831,392 |
|
|
Total current assets |
|
|
54,775,107 |
|
|
|
80,219,860 |
|
|
Property and
equipment, net |
|
|
409,572 |
|
|
|
385,833 |
|
|
Right-of-use
assets |
|
|
336,215 |
|
|
|
565,814 |
|
|
Total assets |
|
$ |
55,520,894 |
|
|
$ |
81,171,507 |
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
1,942,830 |
|
|
$ |
1,798,813 |
|
|
Accrued expenses |
|
|
7,014,882 |
|
|
|
7,896,598 |
|
|
Lease liabilities |
|
|
214,901 |
|
|
|
209,068 |
|
|
Total current liabilities |
|
|
9,172,613 |
|
|
|
9,904,479 |
|
|
Lease
liabilities, long-term |
|
|
119,524 |
|
|
|
353,694 |
|
|
Total liabilities |
|
|
9,292,137 |
|
|
|
10,258,173 |
|
|
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
|
Common stock |
|
|
47,896 |
|
|
|
41,218 |
|
|
Additional paid-in capital |
|
|
320,698,146 |
|
|
|
310,353,595 |
|
|
Accumulated deficit |
|
|
(274,517,285 |
) |
|
|
(239,481,479 |
) |
|
Total stockholders' equity |
|
|
46,228,757 |
|
|
|
70,913,334 |
|
|
Total liabilities and stockholders' equity |
|
$ |
55,520,894 |
|
|
$ |
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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