On November 8, 2017 Zymeworks Inc. (NYSE/TSX: ZYME), a clinical-stage biopharmaceutical company dedicated to the discovery, development and commercialization of next-generation multifunctional biotherapeutics, reported financial results for the third quarter ended September 30, 2017 (Press release, Zymeworks, NOV 8, 2017, View Source [SID1234521823]).
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"During the third quarter, we provided an update on our ongoing Phase 1 clinical trial of ZW25 where we continued to see impressive single agent anti-tumor activity, including a partial response at each weekly dosing cohort," said Ali Tehrani, Ph.D., Zymeworks’ President & CEO. "Our strategic partners also continued advancing their therapeutic candidates developed using our Azymetric bispecific platform. Recent successes by Merck and Daiichi Sankyo further validate the value of our technology platform for developing next-generation best-in-class therapeutics."
Third Quarter Business Highlights and Recent Developments
Zymeworks received a milestone payment of one million dollars from Daiichi Sankyo based on the achievement of a research milestone for an immuno-oncology bispecific antibody candidate under their collaboration.
Merck notified Zymeworks of its plans to advance, into preclinical development, a bispecific antibody candidate developed in collaboration with Zymeworks using Zymeworks’ proprietary Azymetric and EFECT platforms.
Additional safety and anti-tumor activity data from Zymeworks’ ongoing Phase 1 study of ZW25 was presented at the European Society for Medical Oncology ("ESMO") 2017 Congress. The dose escalation portion of the Phase 1 trial is now complete and new expansion cohorts have begun enrolling.
Financial Results for the Third Quarter Ended September 30, 2017
All amounts are in U.S. dollars. Zymeworks’ unaudited condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles ("GAAP") used in the United States.
Revenues for the three months ended September 30, 2017 were $0.1 million compared to $2.2 million for the same period of 2016. The decrease in collaboration revenue between the periods was due to a non-recurring $2.0 million upfront technology access fee from Daiichi Sankyo received in 2016. Collaboration revenues are expected to vary based on the timing of new partnerships and research progress within existing programs.
Research and development expenditures for the three months ended September 30, 2017 were $11.5 million, compared to $9.8 million for the same period in 2016. The $1.7 million increase in research and development expenses was primarily due to increased clinical costs for ZW25, antibody drug conjugate ("ADC") development, and antibody discovery activities, partially offset by decreased expenses associated with the development of ZW33.
General and administrative expenses for the three months ended September 30, 2017 were $5.3 million compared to $2.7 million for the same period in 2016. General and administrative expenses increased between the periods by $2.6 million primarily due to an increase in compensation costs, professional fees, and recruitment costs.
The net loss for the three months ended September 30, 2017 was $16.2 million. Zymeworks expects research and development expenditures to increase due to the ongoing development of product candidates and other clinical, preclinical, and regulatory activities.
As of September 30, 2017, Zymeworks had $49.1 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, its ability to receive these payments is dependent upon either Zymeworks or its collaborators successfully completing specified research and development activities.