Financial Data and Key Metrics Changes - The company has approximately $500 million left in regulatory milestones and about $860 million in commercial milestones, with royalties ranging from 10% to 20% based on net sales [10][11][12] Business Line Data and Key Metrics Changes - The zanidatamab program is a significant focus, with upcoming Phase 3 study readouts expected in Q4, which could drive value for the company [6][10] - ZW171 has been discontinued due to on-target, off-tumor toxicity, reflecting the company's disciplined approach to capital allocation [14][16][17] Market Data and Key Metrics Changes - The competitive landscape for zanidatamab includes potential opportunities in breast cancer, with Jazz Pharmaceuticals exploring this area [11][12] - ZW191 is positioned as a strong contender in the folate receptor alpha ADC space, with a focus on differentiating its product through superior internalization and potency [20][21][22] Company Strategy and Development Direction - The company emphasizes a disciplined approach to capital allocation and decision-making regarding its pipeline programs, focusing on those with the highest potential for patient benefit [14][16] - The strategy includes exploring partnerships for various programs, particularly ZW191, to enhance development and market reach [30][39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the upcoming data readouts and the potential for zanidatamab to capture significant market value, estimating a valuation of over $2 billion [12][13][45] - The company is preparing for multiple catalysts over the next 12 to 18 months, including clinical studies for ZW251 and ZW209 [45] Other Important Information - The ZW209 program, utilizing a tri-TCE platform, is expected to enter clinical trials in the first half of 2026, showcasing the company's commitment to advancing its innovative pipeline [34][45] - The company is also exploring early-stage pipeline opportunities, including novel targets and ADCs, to leverage its protein engineering capabilities [33][34] Q&A Session Summary Question: What is the significance of the upcoming zanidatamab readout? - The readout is expected to provide clarity on the differentiation of zanidatamab in the competitive landscape, particularly in gastroesophageal adenocarcinoma [6][7] Question: What are the financial implications of the zanidatamab program? - The company has significant regulatory and commercial milestones associated with zanidatamab, which could lead to substantial revenue through royalties and milestone payments [10][11] Question: What led to the discontinuation of ZW171? - The decision was based on a lack of efficacy and on-target, off-tumor toxicity, demonstrating the company's commitment to prudent capital allocation [14][16][17] Question: How does Zymeworks differentiate its ADCs? - The company focuses on the holistic design of ADCs, ensuring that the antibody is optimized for internalization and payload delivery, which sets it apart from competitors [20][21][22] Question: What are the next steps for ZW191? - The company is considering partnerships for ZW191 and exploring various tumor types for clinical trials, including ovarian and endometrial cancers [30][39]

Group 1 - The article discusses Zymeworks Inc. (NASDAQ: ZYME) and highlights its recent progress, particularly focusing on two key milestones related to its drug Zanidatamab [2] - The author operates the Biotech Analysis Central service, which provides in-depth analysis of various pharmaceutical companies and includes a model portfolio of small and mid-cap stocks [2] - The service offers a subscription model with a promotional two-week free trial and a discounted annual plan [1] Group 2 - The article does not provide specific financial data or performance metrics for Zymeworks Inc. or its products [4] - There are no disclosures regarding stock positions or business relationships with the companies mentioned, indicating an unbiased perspective [3]

Zymeworks Inc. ZYME on Tuesday decided to voluntarily discontinue clinical development of ZW171, a T-cell engager designed to target gynecological, thoracic, and digestive system cancers.ZW171 is designed to address cancers driven by mesothelin, a well-recognized but historically challenging target.The decision to discontinue clinical development of ZW171 was based on completion of the planned cohorts of the dose escalation portion of the Phase 1 trial of ZW171 in patients with ovarian cancer and non-small ...

VANCOUVER, British Columbia, Sept. 02, 2025 (GLOBE NEWSWIRE) -- Zymeworks Inc. (Nasdaq: ZYME), a clinical-stage biotechnology company developing a diverse pipeline of novel, multifunctional biotherapeutics to improve the standard of care for difficult-to-treat diseases, including cancer, inflammation, and autoimmune disease, today announced its decision to voluntarily discontinue clinical development of ZW171, a T cell engager designed to target gynecological, thoracic, and digestive system cancers. ZW171 i ...

Core Viewpoint - Zymeworks Inc. (ZYME) has experienced a bearish trend with a 7.6% loss over the past two weeks, but the formation of a hammer chart pattern suggests a potential trend reversal as buying interest may be increasing [1][2]. Technical Analysis - The hammer chart pattern indicates a potential bottom in the stock price, suggesting that selling pressure may be exhausting [2][5]. - A hammer pattern forms when there is a small candle body with a long lower wick, indicating that the stock opened lower, made a new low, but closed near its opening price, reflecting some buying interest [4][5]. - This pattern is significant when it occurs at the bottom of a downtrend, signaling that bears may have lost control [5]. Fundamental Analysis - There is rising optimism among Wall Street analysts regarding ZYME's future earnings, which supports the potential for a trend reversal [2][7]. - The consensus EPS estimate for ZYME has increased by 14.7% over the last 30 days, indicating analysts' agreement on the company's improved earnings potential [8]. - Zymeworks currently holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks, which typically outperform the market [9][10].

Company Performance - Zymeworks Inc. reported quarterly earnings of $0.03 per share, exceeding the Zacks Consensus Estimate of a loss of $0.52 per share, and showing improvement from a loss of $0.26 per share a year ago, resulting in an earnings surprise of +105.77% [1] - The company achieved revenues of $48.73 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 256.65%, compared to revenues of $19.24 million in the same quarter last year [2] - Over the last four quarters, Zymeworks has surpassed consensus EPS estimates four times and topped consensus revenue estimates two times [2] Stock Performance - Zymeworks shares have declined approximately 15.2% since the beginning of the year, while the S&P 500 has gained 7.9% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.39 on revenues of $27.89 million, and for the current fiscal year, it is -$1.64 on revenues of $100.05 million [7] Industry Outlook - The Medical - Biomedical and Genetics industry, to which Zymeworks belongs, is currently ranked in the top 41% of over 250 Zacks industries, indicating a favorable outlook [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 - Total revenue increased to $48.7 million in Q2 2025 from $19.2 million in Q2 2024, primarily due to a $20 million milestone from B1 and recognition of $80.3 million in deferred revenue [15][16] - Operating expenses decreased by 20% to $49.4 million in Q2 2025 from $62.1 million in Q2 2024, mainly due to a prior year impairment charge [17] - Net income was $2.3 million for Q2 2025, compared to a net loss of $37.7 million in Q2 2024 [17][18] - Cash resources increased to $333.4 million as of June 30, 2025, from $124.2 million at the end of 2024 [18] Business Line Data and Key Metrics Changes - The company has three product candidates in active Phase I trials in 2025, with two additional candidates expected to enter the clinic in 2026 [7][8] - Zanadatumab showed a median progression-free survival of 15.2 months and overall survival of 36.5 months in a study involving HER2 positive tumors [9][10] - The company recognized a $7.5 million option exercise payment related to a licensing agreement with BMS [14] Market Data and Key Metrics Changes - Conditional regulatory approvals for zanadatumab in China and Europe are expected to increase international patient access and potential future royalties [10][13] - The company anticipates an increase in royalty revenues from zanadatumab's international approvals for biliary tract cancer [13] Company Strategy and Development Direction - The company aims to leverage its proprietary technology platforms and strategic partnerships to enhance asset value and deliver long-term returns for shareholders [44][46] - The focus is on advancing a wholly owned pipeline of differentiated antibody drug conjugates and multi-specific antibodies across various therapeutic areas [46][48] - The company is committed to maintaining a science-first approach while exploring partnerships to share risk and resources [48][49] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of capital discipline and clarity in strategy to drive long-term value [44][51] - The company is focused on maximizing cash flow streams from royalties and other healthcare assets while maintaining flexibility in operations [51][52] - Anticipated growth in royalty and milestone income is not expected to trigger an automatic increase in operational expenditures [51] Other Important Information - The company presented data on its novel IL-4, IL-33 bispecific antibody for COPD at a recent conference, highlighting its potential in treating respiratory diseases [36][38] - The IND clearance for ZW251, targeting hepatocellular carcinoma, is seen as a significant advancement in the company's pipeline [28][29] Q&A Session Summary Question: Will PDL1 status be broken out for the triplet for arm C in the top line? - The inclusion of data in a top line press release will be determined by Jazz and B1, the sponsors of the studies [56][57] Question: How much of the ZANI $525 million regulatory milestone is weighted towards GEA versus other indications? - There is $500 million left in development milestones with Jazz, but no specific guidance on allocation has been provided [57] Question: How does ZW191 compare to other topoisomerase-based ADCs? - The company aims to create a differentiated asset with a novel mechanism and tolerability profile, which could allow for combinations with other treatments [60][63] Question: What is the approach for evaluating ZW251 in liver cancer patients? - The company will systematically study the tolerability and efficacy of ZW251 in appropriate patient subsets, considering liver impairment [68][69] Question: When can data from the Phase I trial of ZW191 be expected? - Initial data is anticipated to be shared at peer-reviewed meetings in 2025 or 2026, depending on abstract acceptance [74] Question: What is known about the expression of alpha in non-small cell lung cancer? - Analysis shows a subset of non-small cell lung cancer patients with BOLT receptor expression, encouraging further evaluation in this indication [78]

Financial Performance & Partnerships - Recognized approximately $75 million in 2025, including around $45 million from partnership-related cash milestones and option exercise fees, which significantly reduced net operating cash burn in the first half of 2025 compared to the first half of 2024[12] - Milestone, option exercise, and related deferred revenue of $45.8 million recognized in 2Q 2025 from BeOne and BMS[16, 17] - Potential future milestone payments from existing partnerships could reach up to $6.1278 billion, with royalty rates varying from low single-digit percentages to 20% depending on the partner and therapeutic indication[13] - Cash, cash equivalents, and marketable securities totaled $324.2 million in 2Q 2025, an increase of $9.2 million year-to-date, benefiting from milestone revenues and favorable working capital movements[16, 17] Clinical Development Updates - Investigational New Drug (IND) application cleared for ZW251, with first-in-human studies planned to start in 2025[11, 12, 47] - Phase 2 trial initiated to evaluate zanidatamab in HER2+ neoadjuvant and adjuvant breast cancer[12] - Bristol Myers Squibb collaboration progresses with a $7.5 million option exercise payment to Zymeworks[12] - ZW171: Global Phase 1 study in MSLN-Expressing Solid Tumors (NCT06523803) is an open-label, FIH, dose-escalation study (N~160)[19] - ZW191: Global Phase 1 Study in FRα-Expressing Solid Tumors (NCT06555744) is an open-label, FIH, dose-escalation study (N~145)[24] Zanidatamab Regulatory & Clinical Progress - NMPA granted BeOne conditional approval of zanidatamab in China for BTC, resulting in a $20 million payment to Zymeworks[12] - EMA granted conditional marketing approval of zanidatamab in Europe for BTC, expanding patient access and potential future royalties payable to Zymeworks[12, 47] - Jazz presented encouraging overall survival (OS) data for zanidatamab in 1L HER2+ GEA at the ASCO Annual Congress, showing a median OS of 36.5 months[12]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________________________ FORM 10-Q ______________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-41535 __________________________ ...

[Corporate Update and Second Quarter 2025 Financial Results](index=1&type=section&id=Corporate%20Update%20and%20Second%20Quarter%202025%20Financial%20Results) [Management Commentary and Strategic Outlook](index=1&type=section&id=Management%20Commentary%20and%20Strategic%20Outlook) The company is leveraging partnership revenue to offset R&D costs and shifting its strategy to focus on long-term cash flow from zanidatamab royalties - Strategic partnerships have validated the Azymetric platform and generated **meaningful revenue**, helping to offset R&D cash burn[3](index=3&type=chunk) - The company expects to have **three product candidates in active Phase 1 trials** in the second half of 2025: ZW171, ZW191, and ZW251[3](index=3&type=chunk) - Zymeworks is shifting its business strategy to focus on anticipated **royalty and milestone streams from zanidatamab (Ziihera®)** as a long-term source of positive cash flow[3](index=3&type=chunk)[5](index=5&type=chunk) - Topline data from the pivotal **HERIZON-GEA-01 study** is expected in the fourth quarter of 2025[3](index=3&type=chunk) [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%202025%20Highlights) The quarter featured key regulatory approvals for ZW251 and zanidatamab, strong partnership revenue, and an extended cash runway into late 2027 - The FDA cleared the Investigational New Drug (IND) application for **ZW251**, with first-in-human studies planned to start in 2025[4](index=4&type=chunk) - **Zanidatamab received approval in China and Europe** for 2nd-line HER2-positive biliary tract cancer (BTC), expanding patient access[4](index=4&type=chunk) | Metric | Value (Q2 2025) | | :--- | :--- | | Revenue | $48.7 million | | Ziihera® Net Product Sales (by Jazz) | $5.5 million | | Cash Resources (as of June 30, 2025) | $333.4 million | | Projected Cash Runway | Into 2H-2027 | [Research and Development Progress](index=2&type=section&id=Research%20and%20Development%20Progress) The R&D pipeline advanced with positive preclinical data, ongoing trials, new regulatory clearances, and progress in key partnership programs [Wholly-Owned R&D Programs](index=2&type=section&id=Wholly-Owned%20R%26D%20Programs) The wholly-owned pipeline advanced with promising preclinical data for ZW1528 and FDA clearance for ZW251 to enter clinical trials - Presented new preclinical data for **ZW1528** (IL-4Rα x IL-33 bispecific) showing high-affinity binding, effective signaling blockade, and in vivo efficacy in lung inflammation models[6](index=6&type=chunk)[8](index=8&type=chunk) - Presented trial-in-progress posters for **ZW171** at ASCO and **ZW191** at the ESMO Gynaecological Cancers Congress, detailing their respective Phase 1 studies[6](index=6&type=chunk)[7](index=7&type=chunk) - The FDA cleared the IND application for **ZW251**, a GPC3-targeting antibody-drug conjugate, with Phase 1 clinical studies planned to commence in 2025[8](index=8&type=chunk) [Zanidatamab Program Updates](index=3&type=section&id=Zanidatamab%20Program%20Updates) The zanidatamab program achieved key milestones including positive long-term survival data and regulatory approvals in China and Europe - Long-term data from a Phase 2 trial of zanidatamab in combination with chemotherapy for 1L HER2+ mGEA showed a **median overall survival (OS) of 36.5 months**[10](index=10&type=chunk) - Received conditional approval from the NMPA in China for HER2+ BTC, triggering a **$20.0 million milestone payment** from partner BeOne Medicines[11](index=11&type=chunk) - The European Commission granted conditional marketing authorization for **Ziihera® (zanidatamab)** for HER2+ BTC[12](index=12&type=chunk) - Royalty revenue from partners Jazz and BeOne was **$0.6 million for Q2 2025**, based on $5.5 million in net product sales of Ziihera® by Jazz[13](index=13&type=chunk) [Platform Collaboration Agreements](index=4&type=section&id=Platform%20Collaboration%20Agreements) Collaborations generated significant revenue and yielded positive clinical data, validating the company's technology platforms - Recognized **$7.5 million in revenue** after BMS exercised its commercial license option under a 2014 collaboration agreement[14](index=14&type=chunk) - Partner J&J reported **positive Phase 1 results for pasritamig**, which demonstrated preliminary anti-tumor activity and a favorable safety profile in prostate cancer patients[15](index=15&type=chunk) - Partner Daiichi Sankyo presented a trial-in-progress poster for a Phase 1 study of **DS-2243**, a bispecific T-cell engager[16](index=16&type=chunk) [Financial Performance Analysis](index=4&type=section&id=Financial%20Performance%20Analysis) The company achieved a significant financial turnaround to net income in Q2 2025, driven by increased partnership revenue [Key Financial Results for Q2 2025](index=4&type=section&id=Key%20Financial%20Results%20for%20Q2%202025) The company reported total revenue of $48.7 million and a net income of $2.3 million, a significant turnaround from the prior year | Financial Metric (in millions USD) | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $48.7 | $19.2 | +153.4% | | R&D Expenses | $34.4 | $29.2 | +17.8% | | G&A Expenses | $15.0 | $15.7 | -4.5% | | Net Income (Loss) | $2.3 | $(37.7) | Turnaround to Profit | - The revenue increase was primarily driven by a **$20.0 million milestone from BeOne**, recognition of $18.3 million in related deferred revenue, and a **$7.5 million payment from BMS**[17](index=17&type=chunk) - The company's cash resources of **$333.4 million**, combined with anticipated regulatory milestones, are expected to fund planned operations into the second half of 2027[20](index=20&type=chunk) [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) This section presents the unaudited condensed interim consolidated statements of income and balance sheet data Condensed Consolidated Statements of Income (Loss) (in thousands USD) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $48,726 | $19,243 | | Total operating expenses | $49,400 | $62,129 | | Loss from operations | $(674) | $(42,886) | | Net income (loss) | $2,317 | $(37,686) | | Basic EPS | $0.03 | $(0.49) | | Diluted EPS | $0.03 | $(0.49) | Selected Condensed Consolidated Balance Sheet Data (in thousands USD) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and marketable securities | $333,375 | $324,204 | | Total assets | $408,385 | $463,091 | | Total liabilities | $73,879 | $124,323 | | Stockholders' equity | $334,506 | $338,768 | [Corporate Information](index=5&type=section&id=Corporate%20Information) This section provides an overview of the company's business and includes cautionary notes on forward-looking statements [About Zymeworks Inc.](index=5&type=section&id=About%20Zymeworks%20Inc.) Zymeworks is a clinical-stage biotechnology company developing biotherapeutics for cancer and immunological diseases - Zymeworks is a clinical-stage biotech focused on **cancer, inflammation, and autoimmune diseases** using its complementary therapeutic platforms[18](index=18&type=chunk) - Its lead product, **zanidatamab**, is the first dual HER2-targeted bispecific antibody approved for HER2-positive biliary tract cancer (BTC) in the U.S., Europe, and China[18](index=18&type=chunk) - The company's wholly-owned pipeline includes **ZW171 and ZW191 in Phase 1 studies**, with ZW251 expected to enter the clinic in 2025[18](index=18&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) This section provides a legal disclaimer cautioning investors about the risks and uncertainties of forward-looking statements - The press release includes forward-looking statements regarding **strategic priorities, clinical development timelines, regulatory approvals, and financial projections** like the cash runway[19](index=19&type=chunk)[21](index=21&type=chunk) - Key risks that could cause actual results to differ include **product candidate failure in development**, not achieving milestones, regulatory delays, and unsuccessful commercialization[21](index=21&type=chunk)