Core Viewpoint - Zymeworks Inc. (ZYME) shows potential for significant upside, with a mean price target of $21.35 indicating a 76.7% increase from its current price of $12.08 [1] Price Targets and Estimates - The mean estimate consists of 10 short-term price targets with a standard deviation of $7.45, indicating variability among analysts [2] - The lowest estimate is $12, suggesting a slight decline of 0.7%, while the highest estimate predicts a surge of 148.3% to $30 [2] - Analysts' price targets are often questioned for their reliability, as they may mislead investors rather than provide accurate guidance [3][7] Earnings Estimates and Analyst Agreement - Analysts are optimistic about ZYME's earnings, with a consensus indicating better-than-previously estimated earnings [4] - The Zacks Consensus Estimate for the current year has risen by 6.2% over the past month, with four estimates increasing and no negative revisions [12] - A strong correlation exists between earnings estimate revisions and near-term stock price movements, suggesting potential upside for ZYME [11] Zacks Rank and Investment Potential - ZYME holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate factors [13] - While the consensus price target may not be a reliable indicator of the stock's potential gain, it does provide a directional guide for price movement [13]

Core Insights - Zymeworks Inc. announced the conditional approval of zanidatamab by the National Medical Products Administration (NMPA) in China for treating previously treated, unresectable or metastatic HER2-positive biliary tract cancer (BTC), marking it as the first dual HER2-targeted bispecific antibody approved for this indication in China [1][10] - The approval is a significant advancement for patients with HER2-positive BTC, a group with high unmet medical needs and poor prognoses, and reflects the clinical potential of zanidatamab [2][4] - Zymeworks has received $61 million in upfront and milestone payments from its collaboration partner BeOne Medicines, with an additional $20 million milestone payment linked to the NMPA approval and potential for up to $144 million in further milestones [2][6] Company Overview - Zymeworks is a clinical-stage biotechnology company focused on developing multifunctional biotherapeutics for difficult-to-treat diseases, including cancer, inflammation, and autoimmune diseases [1][6] - The company utilizes its proprietary Azymetric™ technology to engineer and develop zanidatamab, which targets HER2 and induces various mechanisms leading to tumor growth inhibition [5][7] - Zymeworks has strategic partnerships with BeOne Medicines and Jazz Pharmaceuticals, granting exclusive rights for the development and commercialization of zanidatamab in different territories [7] Industry Context - Biliary tract cancers account for approximately 3% of all digestive system tumors, with a rising incidence rate globally, particularly in Asia [4] - Approximately 11%-25.2% of patients with BTC are HER2-positive, making HER2 a validated target for antitumor therapy [4] - Zanidatamab has also received FDA approval in the U.S. and is under regulatory review in the EU, indicating its potential as a best-in-class treatment for HER2-expressing cancers [3][7]

Core Insights - Zymeworks Inc. is advancing its oncology programs with multiple presentations scheduled at major medical conferences, including ASCO and ESMO, highlighting its commitment to developing novel biotherapeutics for difficult-to-treat diseases [1][3][10] Oncology Programs - The company is particularly focused on zanidatamab, which is being presented at ASCO, showcasing long-term outcomes and survival data in HER2-positive gastroesophageal cancer [2][4][6] - Zymeworks' proprietary Azymetric™ platform is emphasized for its ability to develop clinically validated therapeutic antibodies, with zanidatamab being a key example [6][14] Upcoming Presentations - Zymeworks and its partners will present multiple abstracts at the ASCO Annual Meeting from May 31 to June 4, 2025, in Chicago, IL [3] - The ESMO Gynaecological Cancers Congress will also feature a trial-in-progress poster for ZW191, scheduled for June 19-21, 2025, in Vienna, Austria [10] Product Details - Ziihera (zanidatamab-hrii) is a bispecific HER2-directed antibody that has received accelerated approval from the FDA for treating advanced HER2-positive biliary tract cancer [18][34] - ZW171 is a bispecific antibody targeting mesothelin and CD3, designed to enhance T cell-mediated tumor cell killing, with promising preclinical data supporting its efficacy [15][34] - ZW191 is an antibody-drug conjugate targeting folate receptor-α, showing strong activity across various cancer models, including those with low levels of the target [16][17] Clinical Development - The company is actively recruiting for Phase 1 studies of ZW171 and ZW191, with plans for an investigational new drug application for ZW251 in mid-2025 [34] - Zymeworks has established partnerships with BeiGene and Jazz Pharmaceuticals for the development and commercialization of zanidatamab in different territories [33][34]

Core Viewpoint - Zymeworks Inc. is advancing its clinical-stage pipeline with the presentation of new preclinical data for ZW1528, a bispecific molecule targeting IL-4Rα and IL-33, aimed at treating respiratory inflammation, particularly chronic obstructive pulmonary disease (COPD) [1][2]. Group 1: Product Development - ZW1528 demonstrates high affinity binding to IL-4Rα and IL-33, effectively blocking IL-4, IL-13, and IL-33 signaling pathways, which are critical in respiratory inflammation [5][6]. - The bispecific design of ZW1528 shows promising manufacturability and stability, supporting high dosing concentrations and subcutaneous administration [5][7]. - Zymeworks is also developing ZW1572, another bispecific inhibitor targeting IL-4Rα and IL-31 for atopic dermatitis, as part of its expanding IL-4Rα program portfolio [3][5]. Group 2: Preclinical Data and Findings - Preclinical data presented at the ATS conference indicate that ZW1528 can suppress both Type 2 and non-Type 2 immune responses in primary human immune cells from COPD patients [6][7]. - In vivo studies in murine models of lung inflammation show efficacy for ZW1528, with extended pharmacokinetics observed in rodent and non-human primate models [6][7]. - The bispecific antibody's blockade of cytokine-driven activation in human epithelial cells is superior to that achieved with monoclonal antibodies targeting either IL-4Rα or IL-33 [7]. Group 3: Company Overview - Zymeworks is a global biotechnology company focused on developing multifunctional biotherapeutics for difficult-to-treat conditions, including cancer and autoimmune diseases [8]. - The company has a robust pipeline of product candidates and has entered into strategic partnerships to enhance its therapeutic platforms [8].

Core Viewpoint - Zymeworks Inc. (ZYME) shows significant potential for upside, with a mean price target of $21.35 indicating an 83.9% increase from the current price of $11.61 [1] Price Targets and Analyst Consensus - The average of 10 short-term price targets ranges from a low of $12 to a high of $30, with a standard deviation of $7.45, suggesting variability in analyst estimates [2] - The lowest estimate indicates a 3.4% increase, while the highest suggests a 158.4% upside [2] - A low standard deviation indicates strong agreement among analysts regarding the stock's price movement [9] Earnings Estimates and Analyst Optimism - Analysts show strong agreement in revising ZYME's earnings estimates higher, which correlates with potential stock price increases [11] - Over the last 30 days, the Zacks Consensus Estimate for the current year has increased by 1.6%, with two estimates moving higher and no negative revisions [12] - ZYME holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13] Caution on Price Targets - Solely relying on price targets for investment decisions may not be wise, as analysts' ability to set unbiased targets has been questioned [3][7] - Analysts often set overly optimistic price targets due to business incentives, which can lead to inflated estimates [8] - While price targets should not be ignored, they should be approached with skepticism [10]

Company Performance - Zymeworks Inc. reported a quarterly loss of $0.30 per share, better than the Zacks Consensus Estimate of a loss of $0.45, and an improvement from a loss of $0.42 per share a year ago, resulting in an earnings surprise of 33.33% [1] - The company posted revenues of $27.11 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 57.36%, compared to revenues of $10.03 million in the same quarter last year [2] - Over the last four quarters, Zymeworks has surpassed consensus EPS estimates four times, but has only topped consensus revenue estimates once [2] Stock Outlook - Zymeworks shares have declined approximately 22.5% since the beginning of the year, while the S&P 500 has decreased by 4.3% [3] - The company's earnings outlook will be crucial for future stock performance, with current consensus EPS estimates at -$0.51 for the coming quarter and -$1.75 for the current fiscal year [4][7] Industry Context - The Medical - Biomedical and Genetics industry, to which Zymeworks belongs, is currently ranked in the top 33% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Zymeworks' stock performance [5]

Financial Data and Key Metrics Changes - The company reported a net loss of $22.6 million for Q1 2025, a decrease from a net loss of $31.7 million in Q1 2024, primarily due to increased revenue [11] - Revenue for Q1 2025 was $27.1 million, significantly up from $10 million in Q1 2024, driven by milestone revenues and development support [11][12] - Operating expenses increased to $52.7 million in Q1 2025 from $47.3 million in Q1 2024, reflecting a 10% rise [12][13] Business Line Data and Key Metrics Changes - Milestone revenue included $14 million from GSK and $3.1 million from Daiichi Sankyo, contributing to the overall revenue growth [11] - Research and development expenses rose to $35.7 million in Q1 2025 from $32 million in Q1 2024, mainly due to increased costs associated with ZW251 and other preclinical research [12] Market Data and Key Metrics Changes - The company anticipates increased royalty revenue from the potential approval of zanadatumab for advanced HER2 positive biliary tract cancer, with a final decision expected soon [10] - The company is also looking forward to presenting data at several upcoming medical conferences, which may enhance its market presence [9] Company Strategy and Development Direction - The company emphasizes a disciplined approach to cash burn and pipeline management, focusing on evidence-based decisions tied to clinical validation [8] - The R&D strategy includes advancing a diverse pipeline of ADCs and T cell engagers, with a focus on unmet needs in oncology and immunology [36][40] - The company plans to submit an IND for ZW251 by mid-2025, marking a significant milestone in its development strategy [36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the dynamic biotech environment while delivering shareholder value [7][8] - The company remains well-capitalized with $321.6 million in cash and equivalents, projected to fund operations into the second half of 2027 [14][38] - Management highlighted the importance of clinical progress and disciplined capital allocation in creating long-term shareholder value [40] Other Important Information - The company presented six posters at the AACR annual meeting, showcasing advancements in its R&D pipeline [16][35] - The recent appointment of Dr. Sabine McCann as Senior VP of Clinical Development is expected to enhance the company's clinical strategy [37] Q&A Session Summary Question: What are the base case assumptions regarding milestone royalty revenues? - Management emphasized the importance of capital allocation and expressed excitement about the progress made by partners Jazz and Beijing, which could impact future revenues [44][46] Question: Can you provide details on the cytokine induction data for ZW209? - The design of ZW209 allows for localized T cell activation, which may limit cytokine release syndrome, presenting a favorable safety profile compared to other approaches [50][52] Question: How do you view the impact of ex-US patients in the Horizon GEA trial? - Management noted that there is generally no significant difference in efficacy across ethnicities, but they are monitoring the data closely [58][60] Question: What is the expectation for the KLK2 bispecific update at ASCO? - Management indicated that they are looking forward to the data presentation and highlighted the financial interest in the partnership with J&J [63][64] Question: How many internal programs can the company support? - The company can handle approximately five internal programs through phase one and about ten preclinical programs at any one time [87]

Making a Meaningful Difference Accelerating the next generation of therapeutics to improve the standard of care for the most challenging diseases in cancer, autoimmune and inflammatory disease May 2025 Nasdaq: ZYME | zymeworks.com The above assumptions, risks and uncertainties are not exhaustive. Forward-looking statements are made as of the date hereof and, except as may be required by law, Zymeworks undertakes no obligation to update, republish, or revise any forward-looking statements to reflect new info ...

Financial Performance - Total revenue for the three months ended March 31, 2025, was $27,110,000, a significant increase from $10,030,000 in the same period of 2024, representing a 170% growth[21] - The net loss for the three months ended March 31, 2025, was $22,636,000, an improvement from a net loss of $31,653,000 in Q1 2024, indicating a reduction of 28%[21] - The company reported a comprehensive loss of $22,090,000 for Q1 2025, compared to a comprehensive loss of $32,774,000 in Q1 2024, reflecting a 33% improvement[21] - Basic net loss per share improved to $(0.30) in Q1 2025 from $(0.42) in Q1 2024[35] - The net loss for Q1 2025 was $22,636,000, a 28.5% improvement from a net loss of $31,653,000 in Q1 2024[23] Research and Development - Research and development expenses for Q1 2025 were $35,738,000, compared to $32,042,000 in Q1 2024, reflecting an increase of 23%[21] - The company continues to focus on research and development of next-generation multifunctional biotherapeutics[25] - The company anticipates continued losses as it increases research and development expenditures for ongoing product candidate development[91] - Research and development expenses increased by 12% to $35.7 million for the three months ended March 31, 2025, compared to $32.0 million in the same period in 2024[132] - Research and development expenses for zanidatamab decreased by 59% to $1.4 million in Q1 2025 compared to $3.4 million in Q1 2024[132] Cash and Liquidity - Cash and cash equivalents increased to $76,204,000 as of March 31, 2025, compared to $66,103,000 at December 31, 2024, showing a growth of 15%[20] - The company has a cash resource of $321.6 million as of March 31, 2025, which is expected to fund operations for at least the next twelve months[90] - The company’s liquidity sources include cash, cash equivalents, and investments, which are deemed sufficient to fund operations for at least the next 12 months[75] - Cash used in operating activities decreased significantly to $3,407,000 in Q1 2025 from $37,675,000 in Q1 2024[23] - As of March 31, 2025, the company had $321.6 million in cash, cash equivalents, and marketable securities, including $76.2 million in cash and cash equivalents and $245.4 million in marketable securities[139] Assets and Liabilities - Total assets decreased to $425,522,000 as of March 31, 2025, down from $463,091,000 at the end of 2024, a decline of 8%[20] - Total current liabilities decreased to $65,103,000 as of March 31, 2025, down from $88,294,000 at December 31, 2024, a reduction of 26%[20] - The total stockholders' equity as of March 31, 2025, was $324,967,000, a decrease from $338,768,000 at the end of 2024, representing a decline of 4%[20] - The total liabilities decreased from $59,838 million as of December 31, 2024, to $38,223 million as of March 31, 2025[40] Strategic Partnerships and Revenue - The company recognized $27,110 in revenue from strategic partnerships in the three months ended March 31, 2025, compared to $10,030 in the same period of 2024, representing a 170% increase[59] - The company received $471.0 million in non-refundable upfront and milestone payments through collaboration agreements with Jazz and BeiGene, with potential future payments of up to $1.53 billion[113] - The company recognized $14.0 million in milestone revenue from GSK in January 2025, with potential future milestone payments totaling up to $203.5 million in R&D and $867.0 million in commercial payments[109] - The company received $3.1 million in milestone revenue from Daiichi Sankyo following the first patient dosed in a clinical trial, with potential future milestone payments totaling up to $60.3 million in development and $170.0 million in commercial payments[110] Clinical Development and Regulatory Approvals - The FDA granted accelerated approval for Ziihera® (zanidatamab-hrii) for the treatment of adults with previously-treated, unresectable or metastatic HER2-positive biliary tract cancer in 2024[86] - The company is currently focused on the development of two clinical-stage product candidates, ZW171 and ZW191, and is recruiting patients for ongoing global Phase 1 studies in multiple regions[173] - The confirmatory trial for Ziihera® related to its accelerated approval must demonstrate clinical benefit; failure could result in removal from the market, impacting milestone payments and royalties[172] - The FDA granted Fast Track and Breakthrough Therapy designations for zanidatamab, but these designations do not guarantee faster development or approval processes[190][191] Risks and Challenges - The company has incurred significant losses since inception and anticipates continued losses for the foreseeable future, requiring substantial additional funding that may not be available on acceptable terms[163] - Clinical trials are expensive and time-consuming, with high attrition rates; the company may face significant delays or inability to develop product candidates due to various factors[165][176] - Regulatory approval for product candidates is uncertain and may be impacted by changes in regulatory policies or disagreements with regulatory authorities regarding trial designs and data[169][177] - The company faces significant competition, and if competitors develop more effective or less expensive products, it could negatively impact commercial opportunities[162] - The company may encounter challenges in enrolling patients for clinical trials, particularly for rare diseases, which could hinder marketing approval[182]

Revenue and Financial Performance - Revenue for Q1 2025 was $27.1 million, a significant increase from $10.0 million in Q1 2024, including $14.0 million from GSK and $3.1 million from Daiichi Sankyo[15] - Net loss for Q1 2025 decreased to $22.6 million from $31.7 million in Q1 2024, attributed to increased revenue[20] - Revenue from research and development collaborations increased to $27,110,000 in Q1 2025, up from $10,030,000 in Q1 2024, representing a 170% increase[26] - Net loss for Q1 2025 was $22,636,000, an improvement from a net loss of $31,653,000 in Q1 2024, indicating a reduction of approximately 29%[26] - Total operating expenses for Q1 2025 were $52,723,000, compared to $47,832,000 in Q1 2024, reflecting an increase of 10%[26] Cash and Assets - Cash resources as of March 31, 2025, totaled $321.6 million, providing a projected cash runway into the second half of 2027[21] - Cash, cash equivalents, and short-term marketable securities increased to $265,287,000 as of March 31, 2025, compared to $225,776,000 at the end of 2024, showing a growth of 17%[27] - Total assets decreased to $425,522,000 as of March 31, 2025, down from $463,091,000 at the end of 2024, a decline of 8%[27] - Total liabilities decreased to $100,555,000 as of March 31, 2025, compared to $124,323,000 at the end of 2024, representing a reduction of 19%[27] - Stockholders' equity as of March 31, 2025, was $324,967,000, down from $338,768,000 at the end of 2024, a decrease of 4%[27] - The company anticipates sufficient cash resources to fund operations into the second half of 2027, assuming receipt of certain anticipated regulatory milestones[26] Research and Development - Research and development expenses rose to $35.7 million in Q1 2025, compared to $32.0 million in Q1 2024, primarily due to increased expenses for ZW251 and ZW209[16] - The investigational new drug application for ZW251 is expected to be submitted by mid-2025, indicating ongoing product development[3] - The company is actively developing its early-stage pipeline, with ongoing clinical trials and expected data presentations in the near future[26] Partnerships and Collaborations - The company recognized $14.0 million in milestone revenue from GSK in April 2025, with potential future milestone payments totaling up to $203.5 million[12] - Zanidatamab's partner Jazz reported net product sales of $2.0 million in Q1 2025, with Zymeworks receiving $0.2 million in royalties[11] - Zymeworks is focused on executing new collaborations and partnerships to enhance its product pipeline and market presence[26] Administrative and Personnel Changes - General and administrative expenses increased to $17.0 million in Q1 2025 from $15.8 million in Q1 2024, mainly due to higher stock-based compensation[17] - The company appointed Dr. Sabeen Mekan as Senior Vice President, Clinical Development, to enhance its clinical-stage oncology portfolio[4] Presentations and Conferences - Six posters were presented at the AACR annual meeting, showcasing advancements in the company's preclinical and clinical-stage candidates[5]