On August 12, 2021 Zentalis Pharmaceuticals, Inc. (Nasdaq: ZNTL), a clinical-stage biopharmaceutical company focused on discovering and developing small molecule therapeutics targeting fundamental biological pathways of cancers, reported financial results for the second quarter ended June 30, 2021 and highlighted recent corporate accomplishments (Press release, Zentalis Pharmaceuticals, AUG 12, 2021, View Source [SID1234586381]).

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"We have had an extremely productive second quarter, marked by significant clinical and regulatory advances that were outlined in our mid-year review in June. The data presented continue to support our candidates’ potential for best-in-class positioning – both as monotherapies and in combinations – for an array of difficult-to-treat cancers," commented Dr. Anthony Sun, Chairman and Chief Executive Officer of Zentalis. "Of note, our lead candidate, ZN-c3, demonstrated additional deepening and durable tumor responses, and based on this maturing data presented in June, we have identified potential accelerated approval paths for this candidate in USC and a biomarker-driven setting, with the Phase 2 trial in USC already underway."

Continued Dr. Sun, "Furthermore, this momentous period for Zentalis was reinforced by the completion of a recent upsized public offering in which we raised approximately $173 million in gross proceeds. This financing ensures we are well-positioned to fund all upcoming key milestones, with the goal of delivering differentiated cancer treatments to patients globally."

Program Highlights:

In June 2021, Zentalis hosted a mid-year update webcast, providing key clinical and regulatory updates across its pipeline. Clinical highlights from the update included: five confirmed Partial Responses (PRs) and one unconfirmed PR in the Phase 1 monotherapy trial of ZN-c3 in a range of heavily pre-treated solid tumors; plans for two potentially registrational trials for ZN-c3 in USC and a biomarker-driven setting; an oral dose of 50 mg QD demonstrating a Clinical Benefit Rate of 40% in the Phase 1 monotherapy trial of ZN-c5 in ER+/HER2- breast cancer. For more information on the clinical results reported, click here.

In July 2021, the Company dosed the first patient in a Phase 2 trial of ZN-c3 in women with recurrent or persistent USC. Following an end-of-Phase 1 meeting, the U.S. Food and Drug Administration (FDA) agreed in principle that ZN-c3 has the potential for an accelerated approval pathway based on the Phase 2 global study design in USC.

In June 2021, the Company received orphan drug and rare pediatric disease designations from the FDA for ZN-c3 in combination with chemotherapy for the treatment of osteosarcoma. Zentalis expects to initiate a Phase 1/2 trial in 3Q 2021.

In April 2021, Zentalis reported initial results from the Phase 1 portion of a Phase 1/2 trial of ZN-c3 in advanced solid tumors in a late-breaking session at the AACR (Free AACR Whitepaper) Annual Meeting, which was further discussed at a webcast event with Key Opinion Leaders.

In April 2021, Zentalis entered into a Clinical Trial Collaboration and Supply Agreement with GSK to investigate the combination of ZN-c3 and niraparib, GSK’s poly (ADP-ribose) polymerase (PARP) inhibitor, in patients with advanced epithelial ovarian cancer. The Company expects to initiate a Phase 1b trial with this combination in the second half of 2021.
Zentera Highlights:

In July 2021, Zentera, a Shanghai-based clinical-stage biopharmaceutical company formed by Zentalis, announced the completion of a $75 million Series B financing. The proceeds will be used to advance the clinical development of three Zentalis-discovered candidates, ZN-c3, ZN-c5 and ZN-d5, in China, in addition to business development opportunities for pipeline expansion.

As of July 2021, Zentera had received CTA acceptances in China for ZN-c3, ZN-c3 in combination, ZN-c5 and ZN-d5. Two clinical trials are ongoing with plans to initiate one more trial by year-end 2021.
Corporate Highlights:

In July 2021, Zentalis closed an underwritten public offering of 3,565,000 shares of its common stock at a public offering price of $48.50 per share. The total gross proceeds were approximately $172.9 million, before deducting underwriting discounts and commissions and offering expenses payable by Zentalis.
Second Quarter 2021 Financial Results

Cash and Marketable Securities Position: As of June 30, 2021, Zentalis had cash, cash equivalents and marketable securities of $250.9 million. We believe that our existing cash, cash equivalents and marketable securities as of June 30, 2021, together with the net proceeds from our July 2021 follow-on offering, will enable us to fund our operating expenses and capital expenditure requirements into the third quarter of 2023.

Research and Development Expenses: Research and development expenses for the three months ended June 30, 2021 were $44.8 million, compared to $17.5 million for the three months ended June 30, 2020. The increase of $27.3 million was primarily due to increases in external research and development expenses related to our lead product candidates, as we advanced our Phase 1/2 clinical trials for ZN-c3 and ZN-c5. In addition, in the three months ended June 30, 2021, we conducted additional preclinical studies, incurred additional manufacturing costs, and incurred increased costs for study and lab materials.

General and Administrative Expenses: General and administrative expenses for the three months ended June 30, 2021 were $10.4 million, compared to $9.9 million during the three months ended June 30, 2020. This increase of $0.5 million was primarily attributable to an increase of $2.0 million in employee-related and supply costs, partially offset by a reduction in allocable overhead facility expenses.

Net Loss: Net loss was $55.1 million for three months ended June 30, 2021, compared to $27.3 million for the three months ended June 30, 2020. The $27.8 million increase in net loss was primarily the result of the increases in research and development and general and administrative expenses discussed above.

Impact from COVID-19 Pandemic: Though the impact of the COVID-19 pandemic to our business and operating results presents additional uncertainty and cannot be predicted with confidence, we continue to use the best information available to inform our critical accounting estimates.