On May 5, 2021 Zymeworks Inc. (NYSE: ZYME), a clinical-stage biopharmaceutical company developing multifunctional biotherapeutics, reported financial results for the first quarter ended March 31, 2021 (Press release, Zymeworks, MAY 5, 2021, View Source [SID1234579204]).
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"As we look ahead over the next 12 months, Zymeworks is focused on delivering several key clinical data presentations highlighting the significant potential of zanidatamab and ZW49, as well as driving continued value creation from our preclinical assets and partnerships," said Ali Tehrani, Ph.D., Zymeworks’ President & CEO. "Recently, the FDA cleared the IND for zanidatamab’s first randomized Phase 3 trial in first line HER2-positive gastric cancer, which represents a significant corporate milestone. This will also be the second pivotal trial for zanidatamab, in addition to our ongoing trial in refractory HER2-amplified biliary tract cancer. We look forward to presenting the supportive Phase 2 data at an upcoming medical meeting this year."
First Quarter 2021 Business Highlights and Recent Developments
Zanidatamab Advances in Pivotal Trial in Biliary Tract Cancer (BTC)
Enrollment continues at sites across North and South America, Europe, and Asia for the global, pivotal trial for zanidatamab (a HER2-targeted bispecific antibody) monotherapy in patients with previously treated HER2 gene-amplified BTC (HERIZON-BTC-01). This trial was initiated based on encouraging data, recently updated at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Gastrointestinal Cancers Symposium in January, which highlighted a 40% confirmed objective response rate for zanidatamab monotherapy in BTC. Zanidatamab development is also supported by a number of special designations in the U.S. and European Union, including Breakthrough Therapy designation for BTC from the U.S. Food and Drug Administration (FDA).
FDA Clears Zanidatamab Phase 3 Pivotal Trial in First Line HER2-positive Gastroesophageal Adenocarcinoma (GEA)
Zymeworks recently received clearance from the FDA for its first randomized Phase 3 clinical trial for zanidatamab. HERIZON-GEA-01 is a randomized, multicenter study of zanidatamab in combination with chemotherapy with or without BeiGene’s PD-1-targeted antibody, tislelizumab, as a first line treatment for patients with HER2-positive unresectable locally advanced or metastatic GEA. Supportive clinical data from an ongoing Phase 2 clinical trial evaluating zanidatamab with chemotherapy in first line HER2-positive GEA are expected to be presented at a medical conference in the second half of the year.
ZW49 Continues Enrollment in Dose-Escalation and Expansion Cohorts
In January, interim data was presented for ZW49, a bispecific antibody-drug conjugate targeting HER2, which demonstrated antitumor activity and a differentiated safety profile. Specifically, there have been no dose limiting toxicities, no treatment-related hematologic, pulmonary, or liver toxicity, and no treatment-related deaths. Over 90% of treatment-related adverse events have been mild or moderate in severity, with the most common being keratitis, fatigue, and diarrhea, which have been reversible and manageable in an outpatient setting. ZW49 has demonstrated antitumor activity at all dose levels evaluated in the once every three week regimen, including confirmed partial responses and stable disease per RECIST 1.1. Dose escalation is continuing in both the weekly and once every three week schedules and three indication-specific expansion cohorts (HER2-positive breast cancer, HER2-positive GEA, and a basket cohort of other HER2-positive cancers) utilizing the 2.5 mg/kg once every three week regimen have also been initiated. The objective of these studies is to identify a recommended Phase 2 dose and schedule by the end of this year.
Preclinical Assets, Including New Therapeutic Platform, ProTECT, and Zanidatamab Mechanisms of Action Showcased at AACR (Free AACR Whitepaper) Annual Meeting
Data presented at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) in April highlighted preclinical data that reveal new insights into the unique mechanisms of action of lead clinical candidate, zanidatamab, introduce Zymeworks’ fourth therapeutic platform, ProTECT, and describe two new preclinical assets focused on both the cytokine, IL-12, and the immune-oncology target, 4-1BB.
Expanded Commercial and Clinical Leadership
As zanidatamab advances in late-stage clinical development, Zymeworks continues to build its clinical and commercial leadership team in preparation for potential commercial launch. In January, James Priour, former Senior Vice President, Commercial, was promoted to Chief Commercial Officer and named to the Company’s Executive Committee. The Commercial team also recruited Manny Duenas as Vice President, Global Value & Access. The clinical team was strengthened with the recent additions of Dr. Jonas Hylton as Vice President, Medical and Scientific Affairs and Dr. Kaycia Wilde as Vice President, Clinical Operations.
Financial Results for the Quarter Ended March 31, 2021
Revenue for the three months ended March 31, 2021 was $0.6 million compared to $8.3 million for the same period of 2020. Revenue for the first quarter of 2021 related to research support and other payments from our partners. Revenue for the same period in 2020 included $5.0 million from BeiGene for a development milestone and $3.3 million from our partners for research support, drug supply and other payments.
For the three months ended March 31, 2021, research and development expenses were $44.3 million compared to $36.9 million for the same period of 2020. The increase was primarily due to higher salaries and benefits expense from additional headcount and an increase in lab and consulting expenses partly offset by slightly lower third-party research and development program expenses. For the three months ended March 31, 2021, research and development expenses included non-cash stock-based compensation expense of $4.3 million from equity-classified equity awards and a $2.5 million recovery related to the non-cash mark-to-market revaluation of certain historical liability classified equity awards.
For the three months ended March 31, 2021, general and administrative expenses were $1.3 million compared to $7.2 million for the same period in 2020. The decrease was primarily due to a $5.7 million increase in stock-based compensation recovery. For the three months ended March 31, 2021, general and administrative expenses included non-cash stock-based compensation expense of $4.2 million from equity-classified equity awards and a $13.0 million recovery related to the non-cash mark-to-market revaluation of certain historical liability-classified equity awards. Excluding stock-based compensation, general and administrative expense decreased by $0.2 million in the three months ended March 31, 2021 compared to the same period in 2020.
Net loss for the three months ended March 31, 2021 was $44.6 million compared to $31.1 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 expenses referred to above, partially offset by lower general and administrative expenses.
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 March 31, 2021, Zymeworks had $411.5 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.