Zafgen, Inc. (Nasdaq:ZFGN), a biopharmaceutical company dedicated
to significantly improving the health and well-being of patients
affected by obesity and complex metabolic disorders, today
announced its second quarter 2016 financial results.
“The compelling efficacy data that we observed
in our clinical trials of beloranib, our first-generation MetAP2
inhibitor, demonstrate the potential of MetAP2 inhibition to
significantly reduce body weight, improve glycemic control and
impact cardiovascular risk factors, and we are now leveraging our
experience to focus on the development of our differentiated second
generation candidate, ZGN-1061,” said Thomas Hughes, Ph.D.,
President and Chief Executive Officer of Zafgen. “ZGN-1061 has been
optimized to offer the efficacy advantages of beloranib with an
improved safety margin. We look forward to evaluating this
promising candidate in the clinical setting as we advance our Phase
1 clinical trial.”
Recent Corporate and Clinical
Highlights
- The Company is currently screening patients for its Phase 1
clinical trial of ZGN-1061, its second generation MetAP2 inhibitor.
The clinical trial is designed to evaluate safety, tolerability and
pharmacokinetics while also gaining an early indication of weight
loss efficacy over four weeks of treatment. Zafgen continues to
expect Phase 1 data by the end of the first quarter of 2017.
- In July 2016, Zafgen refocused its resources on the development
of ZGN-1061 and suspended further development of beloranib. In
connection with this announcement, the Company implemented a
restructuring plan designed to align operations with its new
development priorities focused on ZGN-1061.
- In June 2016, the Company presented the full data from its
Phase 2b ZAF-203 clinical trial of beloranib in patients with
severe obesity complicated by type 2 diabetes at the American
Diabetes Association's 76th Scientific Sessions. The efficacy data
showed that treatment with a MetAP2 inhibitor was associated with
an improvement in body composition, including a significant
decrease in body weight, as well as glycemic control parameters
including HbA1c, when compared to placebo.
Second Quarter 2016 Financial Results
“We have a strong balance sheet and are well-positioned to
advance development of ZGN-1061 through key value-creating
milestones,” stated Patricia Allen, Chief Financial Officer of
Zafgen. “Our recent restructuring aligned our operations with
a new focus on ZGN-1061, and extended our cash runway to the end of
2018, at which time we expect to have completed a Phase 2a clinical
trial for ZGN-1061.”
Cash, Cash Equivalents and Marketable
SecuritiesAs of June 30, 2016, the Company had cash, cash
equivalents and marketable securities totaling $150.5 million.
Net LossThe Company reported a
net loss for the second quarter of 2016 of $15.0 million, or $0.55
per share, compared to a net loss of $17.8 million, or $0.66 per
share, for the second quarter of 2015.
The weighted average common shares (basic and
diluted) outstanding used to compute net loss per share were
27,272,225 for the second quarter of 2016, compared to 27,011,960
for the second quarter of 2015.
Research and Development
ExpensesResearch and development expenses for the second
quarter of 2016 were $10.2 million, compared to $12.5 million for
the second quarter of 2015. The decrease in research and
development expenses for the quarter ended June 30, 2016 as
compared to the prior year quarter was primarily due to the timing
of preclinical, clinical and manufacturing costs related to
beloranib. The decrease in expenses related to beloranib was
partially offset by increased spending on ZGN-1061 during the three
months ended June 30, 2016 as the program was progressing towards
clinical development. There was also an increase in personnel
related costs related to hiring new employees during the first
three quarters of 2015, as well as an increase in consulting costs
and non-cash stock-based compensation expense.
General and Administrative
ExpensesGeneral and administrative expenses for the second
quarter of 2016 were $4.9 million, compared to $5.1 million for the
second quarter of 2015. The decrease in general and administrative
expenses for the quarter ended June 30, 2016 as compared to the
prior year quarter was primarily due to a decrease in professional
fees, partially offset by an increase in non-cash stock-based
compensation expense.
2016 Financial GuidanceThe
Company expects that its cash, cash equivalents and marketable
securities balance will be greater than $125 million at December
31, 2016.
About ZGN-1061
ZGN-1061 is a fumagillin-class, injectable small molecule second
generation MetAP2 inhibitor that was discovered by Zafgen's
researchers and, to date, has been shown to have an improved safety
margin relative to previous inhibitors in the class. Like other
MetAP2 inhibitors that have shown promise in the treatment of
severe and complicated types of obesity, ZGN-1061 modulates the
activity of key cellular processes that control the body's ability
to make and store fat, and utilize fat and glucose as an energy
source. ZGN-1061 is also anticipated to help reduce hunger and
restore balance to fat metabolism, enabling calories to once again
be used as a productive energy source, leading to weight loss and
improved metabolic control. ZGN-1061 has a promising emerging
profile and is currently in Phase 1 clinical development. Zafgen
holds exclusive worldwide rights for the development and
commercialization of ZGN-1061.
About Zafgen
Zafgen (Nasdaq:ZFGN) is a biopharmaceutical
company dedicated to significantly improving the health and
well-being of patients affected by obesity and complex metabolic
disorders. Zafgen is focused on developing novel therapeutics that
treat the underlying biological mechanisms of severe obesity and
complex metabolic disorders through the MetAP2 pathway. Zafgen has
pioneered the study of MetAP2 inhibitors in both common and rare
forms of obesity. Zafgen's lead product candidate is ZGN-1061,
which is a novel, fumagillin-class MetAP2 inhibitor administered by
subcutaneous injection and is currently in Phase 1 clinical
development. Zafgen is also developing ZGN-839, a liver-targeted
MetAP2 inhibitor, for the treatment of nonalcoholic
steatohepatitis, or NASH, and abdominal obesity. Zafgen aspires to
improve the lives of patients through targeted treatments and has
assembled a team accomplished in bringing therapies to patients
affected by metabolic diseases.
Safe Harbor Statement
Various statements in this release concerning
Zafgen's future expectations, plans and prospects, including
without limitation, Zafgen's expectations regarding the use of
ZGN-1061 and other MetAP2 inhibitors as treatments for severe
obesity and complex metabolic disorders, Zafgen's expectations with
respect to the timing and success of its pre-clinical studies and
clinical trials of ZGN-1061 and its other product candidates, and
Zafgen's expected cash, cash equivalents and marketable securities
balance as of December 31, 2016, may constitute forward-looking
statements for the purposes of the safe harbor provisions under The
Private Securities Litigation Reform Act of 1995 and other federal
securities laws. Forward-looking statements can be identified by
terminology such as "anticipate," "believe," "could," "could
increase the likelihood," "estimate," "expect," "intend," "is
planned," "may," "should," "will," "will enable," "would be
expected," "look forward," "may provide," "would" or similar terms,
variations of such terms or the negative of those terms. Actual
results may differ materially from those indicated by these
forward-looking statements as a result of various important
factors, including, without limitation, Zafgen's ability to
successfully demonstrate the efficacy and safety of ZGN-1061 and
its other product candidates, the pre-clinical and clinical results
for ZGN-1061 and its other product candidates, which may not
support further development and marketing approval, actions of
regulatory agencies, which may affect the initiation, timing and
progress of pre-clinical studies and clinical trials of its product
candidates, Zafgen's ability to obtain, maintain and protect its
intellectual property, Zafgen's ability to enforce its patents
against infringers and defend its patent portfolio against
challenges from third parties, competition from others developing
products for similar uses, Zafgen's ability to manage operating
expenses, Zafgen's ability to obtain additional funding to support
its business activities and establish and maintain strategic
business alliances and new business initiatives, Zafgen's
dependence on third parties for development, manufacture,
marketing, sales and distribution of product candidates, the
outcome of litigation, and unexpected expenditures, as well as
those risks more fully discussed in the section entitled "Risk
Factors" in Zafgen's most recent Quarterly Report on Form 10-Q
filed with the Securities and Exchange Commission, as well as
discussions of potential risks, uncertainties, and other important
factors in Zafgen's subsequent filings with the Securities and
Exchange Commission. In addition, any forward-looking statements
represent Zafgen's views only as of today and should not be relied
upon as representing its views as of any subsequent date. Zafgen
explicitly disclaims any obligation to update any forward-looking
statements, whether as a result of new information, future events
or otherwise.
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ZAFGEN,
INC. |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
(In thousands, except share and per share
data) |
|
(Unaudited) |
|
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|
|
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2016 |
|
2015 |
|
2016 |
|
|
|
2015 |
|
|
Revenue |
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$ |
|
— |
|
|
$ |
|
— |
|
|
$ |
|
— |
|
|
$ |
|
— |
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|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
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Research
and development |
|
|
|
10,163 |
|
|
|
|
12,526 |
|
|
|
|
22,660 |
|
|
|
|
22,741 |
|
|
General
and administrative |
|
|
|
4,899 |
|
|
|
|
5,084 |
|
|
|
|
10,259 |
|
|
|
|
8,109 |
|
|
Total
operating expenses |
|
|
|
15,062 |
|
|
|
|
17,610 |
|
|
|
|
32,919 |
|
|
|
|
30,850 |
|
|
Loss
from operations |
|
|
|
(15,062 |
) |
|
|
|
(17,610 |
) |
|
|
|
(32,919 |
) |
|
|
|
(30,850 |
) |
|
Other
income (expense): |
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|
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|
|
|
|
|
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Interest
income |
|
|
|
225 |
|
|
|
|
63 |
|
|
|
|
434 |
|
|
|
|
102 |
|
|
Interest
expense |
|
|
|
(140 |
) |
|
|
|
(213 |
) |
|
|
|
(300 |
) |
|
|
|
(426 |
) |
|
Foreign
currency transaction gains (losses), net |
|
|
|
(51 |
) |
|
|
|
4 |
|
|
|
|
21 |
|
|
|
|
(54 |
) |
|
Total
other income (expense), net |
|
|
|
34 |
|
|
|
|
(146 |
) |
|
|
|
155 |
|
|
|
|
(378 |
) |
|
Net
loss |
|
$ |
|
(15,028 |
) |
|
$ |
|
(17,756 |
) |
|
$ |
|
(32,764 |
) |
|
$ |
|
(31,228 |
) |
|
Net loss
per share , basic and diluted |
|
$ |
|
(0.55 |
) |
|
$ |
|
(0.66 |
) |
|
$ |
|
(1.20 |
) |
|
$ |
|
(1.19 |
) |
|
Weighted
average common shares outstanding, basic and diluted |
|
|
|
27,272,225 |
|
|
|
|
27,011,960 |
|
|
|
|
27,267,830 |
|
|
|
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26,316,619 |
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ZAFGEN,
INC. |
|
CONDENSED CONSOLIDATED BALANCE
SHEETS |
|
(In thousands, except share and per share
data) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
|
|
2016 |
|
2015 |
|
Assets |
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
|
20,026 |
|
|
$ |
|
35,595 |
|
|
Marketable securities |
|
|
|
130,442 |
|
|
|
|
149,484 |
|
|
Tax
incentive receivable |
|
|
|
1,350 |
|
|
|
|
1,323 |
|
|
Prepaid
expenses and other current assets |
|
|
|
1,334 |
|
|
|
|
1,708 |
|
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Total
current assets |
|
|
|
153,152 |
|
|
|
|
188,110 |
|
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Property
and equipment, net |
|
|
|
1,256 |
|
|
|
|
902 |
|
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Tax
incentive receivable |
|
|
|
331 |
|
|
|
|
— |
|
|
Other
assets |
|
|
|
87 |
|
|
|
|
94 |
|
|
Total
assets |
|
$ |
|
154,826 |
|
|
$ |
|
189,106 |
|
|
|
|
|
|
|
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Liabilities and Stockholders’ Equity |
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|
|
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Current
liabilities: |
|
|
|
|
|
|
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Accounts
payable |
|
$ |
|
2,581 |
|
|
$ |
|
7,495 |
|
|
Accrued
expenses |
|
|
|
4,976 |
|
|
|
|
6,112 |
|
|
Notes
payable, current |
|
|
|
3,057 |
|
|
|
|
2,936 |
|
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Total
current liabilities |
|
|
|
10,614 |
|
|
|
|
16,543 |
|
|
Notes
payable, net of discount, long-term |
|
|
|
1,973 |
|
|
|
|
3,453 |
|
|
Total
liabilities |
|
|
|
12,587 |
|
|
|
|
19,996 |
|
|
Commitments and contingencies |
|
|
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|
|
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|
Stockholders’ equity: |
|
|
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|
Preferred stock; $0.001 par value per share; 5,000,000 shares
authorized as of June 30, 2016 |
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and December 31, 2015; no shares issued and outstanding as of
June 30, 2016 |
|
|
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and December 31, 2015 |
|
|
|
— |
|
|
|
|
— |
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Common
stock, $0.001 par value per share; 115,000,000 shares authorized as
of June 30, 2016 |
|
|
|
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and December 31, 2015; 27,272,261 and 27,242,503 shares issued and
outstanding |
|
|
|
|
|
|
|
as of June 30, 2016 and December 31, 2015, respectively |
|
|
|
27 |
|
|
|
|
27 |
|
|
Additional paid-in capital |
|
|
|
354,661 |
|
|
|
|
348,961 |
|
|
Accumulated deficit |
|
|
|
(212,435 |
) |
|
|
|
(179,671 |
) |
|
Accumulated other comprehensive loss |
|
|
|
(14 |
) |
|
|
|
(207 |
) |
|
Total
stockholders’ equity |
|
|
|
142,239 |
|
|
|
|
169,110 |
|
|
Total
liabilities and stockholders’ equity |
|
$ |
|
154,826 |
|
|
$ |
|
189,106 |
|
|
|
|
|
|
|
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|
This selected financial information should be read in
conjunction with the consolidated financial statements and notes
thereto included in the Company's Annual Report on Form 10-K, as
amended, which includes the Company’s audited consolidated
financial statements for the year ended December 31, 2015.
Media/Investor Relations Contact:
Zafgen, Inc.
Patricia Allen
Chief Financial Officer
617-648-9792
Argot Partners
Investor Relations
Laura Perry or Glenn Garmont
212-600-1902
laura@argotpartners.com
glenn@argotpartners.com
Spectrum Science
Media Relations
Susan Francis
609-529-0676
sfrancis@spectrumscience.com
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