On May 1, 2018 Zymeworks Inc. (NYSE/TSX: ZYME), a clinical-stage biopharmaceutical company developing multifunctional therapeutics, today reported financial results for the quarter ended March 31, 2018 (Press release, Zymeworks, MAY 1, 2018, View Source [SID1234525902]).
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"Over the last few months we have added to our clinical and business momentum," said Ali Tehrani, Ph.D., Zymeworks’ President & CEO. "In addition to the milestones highlighted below, we continue to be encouraged by the clinical progress of our lead candidate, ZW25, and are honored that the updated data was selected for an oral presentation at the upcoming American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) annual meeting next month.
First Quarter 2018 Business Highlights and Recent Developments
Added New Clinical Sites for ZW25 in Canada and the United States; Data Selected for Oral Presentation at ASCO (Free ASCO Whitepaper)
To give more clinicians access to its novel bispecific antibody, Zymeworks announced the opening of new sites in Canada and the United States for its ongoing adaptive Phase 1 study of ZW25. Updated data, from the dose escalation and expansion cohort parts of the study, will be highlighted at an oral presentation at the upcoming ASCO (Free ASCO Whitepaper) annual meeting in Chicago.
Identified ZW49, a Novel Antibody-Drug Conjugate (ADC), as a Clinical Candidate
ZW49 is a proprietary bispecific ADC targeting two distinct locations of the HER2 receptor resulting in enhanced delivery of Zymework’s proprietary ZymeLink cytotoxic payload to cancer cells. Preclinical data, presented at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) annual meeting in April demonstrated ZW49 to be active and well tolerated in models of high and low HER2-expressing cancers. Zymeworks expects to file an Investigational New Drug (IND) application this year in order to begin a clinical trial with ZW49.
Expanded Corporate Collaboration with Celgene
Zymeworks has expanded its relationship with Celgene. Under the terms of the agreement, the research program term has been extended by two years and additional licenses for two products have been added for a total of 10 potential products under the collaboration. Zymeworks is entitled to receive an expansion fee and is eligible to receive up to US$328 million in additional development and commercial milestones resulting in total future potential milestones of US$1.64 billion, plus royalties on worldwide sales.
Financial Results for the Quarter Ended March 31, 2018
Revenue for the three months ended March 31, 2018 was $0.04 million as compared to $0.23 million in the same period in 2017, primarily due to a $0.2 million decrease in research support payments from Daiichi Sankyo as research and development activities under the agreement with Daiichi Sankyo shifted to our partner.
For the three months ended March 31, 2018, research and development expenditures were $13.1 million as compared to $9.1 million for the same period in the prior year. This was primarily due to an increase in clinical costs for ZW25 and development costs for ZW49 in 2018, which was partially offset by a decrease in early stage research and development activities in platform technologies compared to the same period in 2017. General and administrative expenses were $7.1 million for the three months ended March 31, 2018 and $6.3 million for the same period in 2017. The change between the periods was primarily due to an increase in compensation costs and professional fees. The compensation costs increase was the result of new hires as well as an increase in stock-based compensation expense.
The net loss for the three months ended March 31, 2018 increased to $21.2 million as compared to $15.9 million for the same period in 2017, primarily due to increased research & development and general administrative expenses, as well as increase in the fair value of warrant liabilities which was partially offset by impairment charges recorded in 2017. Zymeworks expects research and development expenditures to increase over time due to the ongoing development of product candidates and other clinical, preclinical, and regulatory activities.
As of March 31, 2018, Zymeworks had $70.0 million in cash and cash equivalents and short-term investments. Zymeworks expects to continue receiving revenue from its existing and future corporate collaborations, including technology access fees, research and development fees for services rendered, 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.