On November 9, 2026 Zymeworks Inc. (Nasdaq: ZYME), a biotechnology company managing a portfolio of licensed healthcare assets, while developing a diverse pipeline of novel, multifunctional biotherapeutics, reported financial results for the third quarter ended September 30, 2026 and provided a summary of recent business highlights. The Company has elected not to host a third quarter earnings conference call after release of its financial results.
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"We are entering the next phase of Zymeworks growth with a fundamentally stronger and more diversified business. The transformation of Zymeworks is becoming increasingly visible in our financial profile and in the breadth of opportunities available to us," said Kenneth Galbraith, Chair and Chief Executive Officer of Zymeworks. "Over the course of 2026, Ziihera has expanded its label into first-line HER2-positive advanced gastroesophageal adenocarcinoma, we have completed the acquisition of Theravance Biopharma, adding a recurring commercial cash-flow stream through YUPELRI. We have also made progress on strategic transactions that can expand the opportunities for our R&D portfolio, while reducing risk, maintaining R&D discipline, and adding potential future milestones and royalties. We are pleased to report an increase in our financial guidance for 2026 as a result of this business development execution. These advancements demonstrate the strategy we set out a year ago – to build a durable financial foundation through partnered and commercial assets, while maintaining the ability to create additional value through R&D, acquisitions, partnerships and disciplined capital allocation."
Financial Highlights
Royalty revenue from Jazz Pharmaceuticals (Jazz) and BeOne Medicines (BeOne) was $2.3 million in the three months ended September 30, 2026, driven primarily by net product sales of Ziihera by Jazz in the United States.
YUPELRI collaboration revenue increased 4% year-over-year (YoY). Quarterly U.S. net sales of $71.5 million for YUPELRI, recognized by Viatris, in 3Q-2026, increasing 0.2% YoY (3Q-2026 vs 3Q-2025).
Increased doses of YUPELRI pulled through the hospital channel grew at a double-digit rate YoY, reflecting continued underlying momentum. Theravance Biopharma contributed approximately $1.5 million of revenue during the quarter, reflecting seven days of ownership following the September 23, 2026 acquisition date.
Under the terms of our collaboration with Jazz, Zymeworks received a $250 million milestone payment related to Ziihera’s U.S. FDA approval for first-line treatment of HER2-positive advanced GEA in October 2026. Zymeworks remains eligible for up to $190 million in potential additional global regulatory milestones related to ex-U.S. approvals for Ziihera in HER2-positive GEA from Jazz and BeOne.
During 2026, Zymeworks has accessed $600 million of non-dilutive financing through a non-recourse royalty-backed note, and a non-recourse note, with a weighted average cost of capital of less than 10%. The financing supported the Theravance Biopharma acquisition and the Company’s share repurchase program while minimizing equity dilution. The Company currently has no current plans for additional equity issuances.
Repurchased 534,381 shares for $14.0 million in the third quarter of 2026, with total share repurchases of 5,737,790 shares for $140.4 million in the first nine months of 2026 at an average price of $24.48 per share (exclusive of commission expense and estimated excise tax).
The Company has increased its 2026 financial guidance for total revenue to be between $337 million and $351 million (previously between $278 million and $292 million) and adjusted EBITDA to be between $176 million and $190 million (previously between $114 million and $128 million), excluding the impact of any future transactions. This financial guidance is subject to expiration or termination of the waiting period under HSR as it relates to the Roche collaboration, expected during the fourth quarter of 2026.
Business Highlights
Expanding Revenue Diversification Through Theravance Biopharma Acquisition
On September 23, 2026, Zymeworks completed the previously announced acquisition of Theravance Biopharma. With the completion of the transaction, Theravance Biopharma is now part of Zymeworks, further advancing Zymeworks’ strategy to build a diversified revenue-generating biotechnology company, combining innovative R&D with growing commercial and royalty-based cash flows. Post-closing, we expect $13 million to $15 million of annualized overhead and corporate costs to be eliminated, reducing future operating expenses.
On September 28, 2026, Zymeworks announced the appointment of Stuart Knight as Executive Vice President, Chief Information Officer, as well as Jesse Fecker as Vice President of Intellectual Property, both of whom join Zymeworks from Theravance Biopharma.
On October 19, 2026, Zymeworks announced the appointment of Suzanne Monahan as Senior Vice President and General Manager, Theravance Biopharma.
Recent Developments
Recent key developments related to our portfolio are discussed below:
Ziihera (zanidatamab-hrii)
On August 25, 2026, our partner Jazz received U.S. FDA approval for two Ziihera-containing regimens for the first-line treatment of adults with unresectable locally advanced or metastatic HER2-positive GEA. Jazz subsequently launched U.S. commercialization, and secured a recommendation in the European Society of Medical Oncology (ESMO) (Free ESMO Whitepaper) Clinical Practice Guidelines, as well as a Category 2A recommendation from the National Comprehensive Cancer Network (NCCN), positioning Ziihera as a preferred treatment for first-line GEA patients.
On October 23, 2026, results from the second interim, and final formal, analysis of HERIZON-GEA-01 were presented as a late-breaking rapid oral presentation at the ESMO (Free ESMO Whitepaper) Annual Congress 2026. Key findings include:
Nearly 40% of patients alive at three years with Ziihera plus tislelizumab and chemotherapy, irrespective of PD-L1 status, achieving a median overall survival (OS) of 27 months.
Mature HERIZON-GEA-01 results show Ziihera plus chemotherapy delivered statistically significant and clinically meaningful OS benefit, reducing the rate of death by 24% versus trastuzumab plus chemotherapy.
The Ziihera plus tislelizumab and chemotherapy regimen reduced the risk of death by 35% (hazard ratio [HR] 0.65; 95% CI: 0.52–0.80), improving from an HR of 0.72 at the first interim analysis.
Other Partnered Programs
ZW209
On October 23, 2026, Zymeworks announced an exclusive global collaboration and license agreement with Roche for the development of ZW209. Under the agreement, Zymeworks is eligible to receive an upfront payment of $55 million, a $40 million payment upon initiation of the Phase 1b trial, additional development, commercial and sales-based milestone payments of up to $718 million, and tiered high single digit to mid-teens royalties on future net sales of any approved medicines resulting from the collaboration. This transaction is subject to the expiration or termination of the waiting period under HSR.
ZW209 has received Investigational New Drug clearance from the U.S. FDA. We anticipate initiating a Phase 1, open-label, multicenter, global study in 2026 investigating ZW209 in collaboration with Roche to evaluate safety, tolerability, pharmacokinetics, and preliminary anti-tumor activity. Roche will fund the Phase 1a trial and be responsible for subsequent global development and commercialization of ZW209.
"Importantly, this collaboration with Roche demonstrates how the components of our business model work together in practice. By combining recurring commercial cash flows with a disciplined approach to R&D and partnerships, we are building a business model that can generate value through multiple pathways," said Kenneth Galbraith. "Recurring cash flows provide greater flexibility to invest selectively in programs and opportunities with meaningful value-creation potential, while our R&D engine and business development activities create additional opportunities to generate milestones, royalties, licensing proceeds and other sources of long-term value. Just as importantly, we can increasingly match the capital and ownership structure to each opportunity, whether acquiring and operating a business, partnering an asset, licensing a program or bringing in external venture capital, without assuming that every opportunity must be funded entirely from our balance sheet."
Pasritamig
On November 7, 2026, our partner Johnson & Johnson presented new data on the Phase 1 study of pasritamig (KLK2×CD3) in combination with JNJ-9401 (PSMA×CD28) at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper). Results demonstrated encouraging anti-tumor activity in heavily pretreated patients with metastatic castration-resistant prostate cancer:
At the recommended Phase 2 regimen, the combination achieved a 73% PSA50 response rate, 47% PSA90 response rate, and undetectable PSA in 27% of patients, with responses ongoing beyond six months in all four patients achieving undetectable PSA.
The combination maintained a favorable safety profile, with no Grade ≥3 treatment-related adverse events, no Grade ≥2 CRS and no treatment discontinuations at the recommended regimen.
Wholly-Owned R&D Pipeline
On October 24, 2026, Zymeworks presented new Phase 1 data for folate receptor alpha-targeting antibody-drug conjugate, ZW191, at the ESMO (Free ESMO Whitepaper) Annual Congress. Updated data presented for ZW191 demonstrates compelling anti-tumor activity in heavily pretreated patients with platinum-resistant ovarian cancer across folate receptor alpha expression levels:
Confirmed objective response rates of 64.5% at the 6.4 mg/kg dose in patients with high-grade serous platinum-resistant ovarian cancer.
Median duration of response not yet reached at either dose level at median 7 months follow-up, with six-month progression-free survival rate of 61% in both groups.
Favorable tolerability profile, particularly at 6.4 mg/kg, supports continued clinical development in partnership or through a strategic collaboration.
On November 7, 2026, Zymeworks presented preclinical data at SITC (Free SITC Whitepaper) on a novel PD-1xVEGFxIL-7 multispecific antibody with optimized geometry that achieves targeting of IL-7 to PD-1+ T cells. The poster presentation titled "Engineering targeted IL-7 delivery to enhance anti-tumor T cell fitness and persistence" shows that combining checkpoint and angiogenesis blockade with a T cell cytokine signal, PD-1xVEGFxIL-7 represents a mechanistically distinct strategy to improve the durability of anti-tumor responses.
On December 13, 2026, Zymeworks will present new preclinical data for a penta-specific antibody at the American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exhibition via a poster presentation titled "ZW1953: A multispecific T cell engager targeting FLT3, CLEC12A, and CD33 with conditional CD28 co-stimulation designed to overcome resistance mechanisms and improve treatment responses in AML", representing the first scientific disclosure for Zymeworks in a hematological cancer indication.
The Company plans to host a R&D Day on February 11th, 2027 in New York, NY. A live webcast of the event will be accessible through Zymeworks’ Investor Relations website at ir.zymeworks.com. A detailed agenda, including registration and dial-in information, will be provided closer to the event.
Financial Results for the Quarter Ended September 30, 2026
The key financial highlights for our 2026 third quarter results are as follows:
Theravance Biopharma Acquisition – The acquisition of Theravance Biopharma closed on September 23, 2026 and had a limited impact on third quarter operating results given the timing of the transaction. Theravance Biopharma contributed approximately $1.5 million of revenue during the quarter, reflecting seven days of ownership following the acquisition date. The primary earnings impact related to integration and transaction-related costs associated with the acquisition.
Revenue – Total revenue was $256.5 million in 3Q-2026, compared to $27.6 million for the same period in 2025. The increase was primarily due to the $250.0 million milestone earned from Jazz following the U.S. approval of Ziihera for first-line HER2-positive GEA in August 2026. The increase was partially offset by the absence of a $25.0 million development milestone from Johnson & Johnson Innovative Medicine recognized during the third quarter of 2025.
Research and Development (R&D) Expenses – R&D expenses were $36.1 million in 3Q-2026, compared to $35.6 million for the same period in 2025. R&D expenses were generally consistent with the prior year period, as lower spending on ZW171 following discontinuation of the program in 2025 and reduced spending on certain preclinical programs after completion of IND-enabling activities were largely offset by employee-related costs associated with the Theravance Biopharma acquisition.
Selling, General and Administrative (SG&A) Expenses – SG&A expenses were $42.7 million in 3Q-2026, compared to $14.1 million for the same period in 2025. The increase was primarily driven by costs associated with the Theravance Biopharma acquisition, including severance and transaction-related professional fees, together with higher stock-based compensation expense associated with 2026 equity awards, including leadership transition awards and the settlement of certain Theravance Biopharma equity awards.
Other Income, net – Net other expense was $4.4 million in 3Q-2026, compared to net other income of $3.8 million for the same period in 2025. The change was driven primarily by interest expense related to the royalty-backed note financing arrangement with Royalty Pharma executed in March 2026 and lower interest income resulting from reduced investment balances.
Net Loss – Net income was $173.7 million in 3Q-2026, compared to a net loss of $19.6 million for the same period in 2025. The increase was driven primarily by the $250.0 million milestone earned from Jazz following U.S. approval of Ziihera for first-line HER2-positive GEA in August 2026, partially offset by nonrecurring acquisition related costs and interest expense associated with the Company’s royalty-based note financing arrangement with Royalty Pharma in March 2026.
Since initiating its share repurchase program in August 2024, the Company has cumulatively utilized $279.8 million to reacquire 12,940,827 shares at an average price of $21.63 per share (exclusive of commission expense and estimated excise tax). As of November 6, 2026, the Company had approximately 69.0 million common shares outstanding.
(Press release, Zymeworks, NOV 9, 2026, View Source [SID1234674519])