Zynerba Pharmaceuticals, Inc. (Nasdaq: ZYNE), the leader in
innovative pharmaceutically-produced transdermal cannabinoid
therapies for rare and near-rare neuropsychiatric disorders, today
reported financial results for the fourth quarter and full year
ended December 31, 2020, and provided an overview of recent
operational highlights and a pipeline update.
“We expect to make significant progress in 2021 on
all four indications for which we are developing Zygel, including
initiating a pivotal trial in patients with Fragile X syndrome who
have a highly methylated FMR1 gene to confirm the positive results
in this population of responders in the CONNECT-FX trial,” said
Armando Anido, Chairman and Chief Executive Officer of Zynerba.
“Screening in the INSPIRE trial of patients with 22q11.2 deletion
syndrome has resumed now that COVID-19 restrictions in Australia
have begun to ease. Once enrollment is complete we will update our
expectation on when we will see topline results for this
trial.”
Operational Highlights and Pipeline Update
Zygel™ in Fragile X Syndrome (FXS)
- Zynerba expects to initiate a single
double-blind, placebo-controlled pivotal trial before the end of
2021 in patients with FXS who have a highly methylated FMR1 gene to
confirm the positive results observed in this population of
responders in the CONNECT-FX trial. The Company believes that
positive results from this confirmatory pivotal trial will be
sufficient to support the submission of a New Drug Application for
Zygel in FXS. (Press release)
- Zynerba will review the trial design
and protocol for the new confirmatory pivotal trial through a Type
C meeting with the U.S. Food and Drug Administration (FDA) in the
first half of 2021.
Zygel in 22q11.2 Deletion Syndrome (22q)
- The Company has
initiated a second clinical site in Australia for the 14-week open
label Phase 2 INSPIRE trial in children and adolescents with
genetically confirmed 22q.
- As the
COVID-19-related restrictions in Australia are easing, the Company
has resumed screening of patients for this trial. Once enrollment
is complete, a timeframe for disclosing topline results of the
trial will be provided. In September 2020, the Company was granted
orphan drug designation from the FDA for the use of cannabidiol for
the treatment of 22q.
Zygel in Autism Spectrum Disorder (ASD)
- In the first half of 2021, Zynerba
intends to discuss with the FDA data supporting the potential
efficacy of Zygel in ASD, including the results of the Phase 2
BRIGHT trial in children and adolescents with moderate to severe
ASD, to determine the regulatory path forward.
Zygel in Developmental and Epileptic Encephalopathies
(DEE)
- Zynerba expects to
conduct an observational trial that will help finalize target
syndrome selection in one or more DEE syndromes in 2021.Zynerba
concluded its iterative discussions with the FDA utilizing their
‘Written Response Only’ (WRO) meeting format regarding the clinical
pathway for Zygel in DEE during which the FDA expressed support for
a development program which would evaluate the treatment of
focal-impaired awareness seizures (FIAS) and tonic-clonic seizures
(TCS). Due to the heterogeneity of patients who fall under the DEE
umbrella, Zynerba will pursue individual syndromes rather than
considering DEE as a single disorder or condition (Press release).
The Company expects to conduct an observational trial that will
help finalize target syndrome selection in one or more DEE
syndromes by the end of 2021.
- New efficacy data
presented at the 2020 annual meeting of the American Epilepsy
Society show strong evidence of seizure reduction.The new efficacy
data from the Phase 2 BELIEVE trial (Open Label Study to Assess the
Safety and Efficacy of Zygel Administered as a Transdermal Gel to
Children and Adolescents with DEE) describe strong evidence of
seizure reduction over 12 months of treatment, including a 73%
median reduction from baseline in FIAS and TCS seizure frequency at
month 12. Furthermore, in the subgroup of patients with ASD, Zygel
demonstrated meaningful reductions in FIAS and TCS seizures, with
most children reaching either the 35% or 50% responder threshold by
month three and month six, respectively.The data also show that
Zygel improved the profound sleep disturbance experienced by
patients with DEE who were enrolled in the trial (Press
release).
Fourth Quarter and Full Year 2020 Financial
Results
Research and development expenses were $5.6 million for the
fourth quarter of 2020, including stock-based compensation of $0.6
million. General and administrative expenses were $4.6 million in
the fourth quarter of 2020, including stock-based compensation
expense of $0.6 million. The net loss for the fourth quarter of
2020 was $9.6 million with basic and diluted loss per share of
$(0.33).
Research and development expenses were $35.7 million for full
year 2020, including stock-based compensation of $2.2 million.
General and administrative expenses were $16.4 million for full
year 2020, including stock-based compensation expense of $3.0
million. The net loss for the full year 2020 was $51.3 million with
basic and diluted net loss per share of $(1.90).
Financial Outlook
As of December 31, 2020, cash and cash equivalents were $59.2
million, compared to $70.1 million as of December 31, 2019. In
August 2019, we entered into a Controlled Equity Offering Sales
AgreementSM, or the 2019 Sales Agreement, with Cantor Fitzgerald
& Co., Canaccord Genuity, LLC, H.C. Wainwright & Co. LLC
and Ladenburg Thalmann & Co. Inc., as sales agents pursuant to
which we may sell, from time to time, up to $75.0 million of our
common stock. In the fourth quarter of 2020, we sold and issued
558,089 shares of our common stock under the 2019 Sales Agreement
in the open market resulting in gross proceeds of $1.9 million and
net proceeds of $1.9 million, after deducting commissions and
offering expenses. From January 1, 2021 through February 9, 2021,
we have sold and issued 10,244,326 shares of our common stock under
the 2019 Sales Agreement in the open market resulting in gross
proceeds of $43.2 million and net proceeds of $42.2 million, after
deducting commissions and offering expenses. As of February 9,
2021, we have utilized the entire $75 million authorized under the
2019 Sales Agreement, which was terminated pursuant to its
terms.
Management believes that cash and cash equivalents, including
the $42.2 million in net proceeds from issuances between January 1
and February 9, 2021 under the 2019 Sales Agreement, are sufficient
to fund operations and capital requirements well into the first
half of 2024.
About Zynerba Pharmaceuticals, Inc.
Zynerba Pharmaceuticals is the leader in innovative
pharmaceutically-produced transdermal cannabinoid therapies for
rare and near-rare neuropsychiatric disorders. We are committed to
improving the lives of patients and their families living with
severe, chronic health conditions including Fragile X syndrome,
autism spectrum disorder, 22q11.2 deletion syndrome, and a
heterogeneous group of rare and ultra-rare epilepsies known as
developmental and epileptic encephalopathies. Learn more at
www.zynerba.com and follow us on Twitter at @ZynerbaPharma.
Cautionary Note on Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of The Private Securities Litigation Reform Act of
1995. We may, in some cases, use terms such as “predicts,”
“believes,” “potential,” “proposed,” “continue,” “estimates,”
“anticipates,” “expects,” “plans,” “intends,” “may,” “could,”
“might,” “will,” “should” or other words that convey uncertainty of
future events or outcomes to identify these forward-looking
statements. Such statements are subject to numerous important
factors, risks and uncertainties that may cause actual events or
results to differ materially from the Company’s current
expectations. Management’s expectations and, therefore, any
forward-looking statements in this press release could also be
affected by risks and uncertainties relating to a number of other
factors, including the following: the Company’s cash and cash
equivalents may not be sufficient to support its operating plan for
as long as anticipated; the Company’s expectations, projections and
estimates regarding expenses, future revenue, capital requirements,
incentive and other tax credit eligibility, collectability and
timing, and availability of and the need for additional financing;
the Company’s ability to obtain additional funding to support its
clinical development programs; the results, cost and timing of the
Company’s clinical development programs, including any delays to
such clinical trials relating to enrollment or site initiation;
clinical results for the Company’s product candidates may not be
replicated or continue to occur in additional trials and may not
otherwise support further development in a specified indication or
at all; actions or advice of the U.S. Food and Drug Administration
and foreign regulatory agencies may affect the design, initiation,
timing, continuation and/or progress of clinical trials or result
in the need for additional clinical trials; the Company’s ability
to obtain and maintain regulatory approval for its product
candidates, and the labeling under any such approval; the Company’s
reliance on third parties to assist in conducting pre-clinical and
clinical trials for its product candidates; delays, interruptions
or failures in the manufacture and supply of the Company’s product
candidates the Company’s ability to commercialize its product
candidates; the size and growth potential of the markets for the
Company’s product candidates, and the Company’s ability to service
those markets; the Company’s ability to develop sales and marketing
capabilities, whether alone or with potential future collaborators;
the rate and degree of market acceptance of the Company’s product
candidates; the Company’s expectations regarding its ability to
obtain and adequately maintain sufficient intellectual property
protection for its product candidates; the timing and outcome of
current and future legal proceedings; and the extent to which
health epidemics and other outbreaks of communicable diseases,
including COVID-19, could disrupt our operations or adversely
affect our business and financial conditions. This list is not
exhaustive and these and other risks are described in the Company’s
periodic reports, including the annual report on Form 10-K,
quarterly reports on Form 10-Q and current reports on Form 8-K,
filed with or furnished to the Securities and Exchange Commission
and available at www.sec.gov. Any forward-looking statements
that the Company makes in this press release speak only as of the
date of this press release. The Company assumes no obligation to
update forward-looking statements whether as a result of new
information, future events or otherwise, after the date of this
press release.
ZYNERBA PHARMACEUTICALS,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
(unaudited) |
|
|
|
|
|
|
Three months ended December 31, |
|
Year ended December 31, |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
2020 |
|
|
|
2019 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research and development |
|
$ |
5,616,412 |
|
|
$ |
7,457,953 |
|
|
$ |
35,654,994 |
|
|
$ |
20,384,049 |
|
General and administrative |
|
|
4,573,114 |
|
|
|
3,958,211 |
|
|
|
16,407,548 |
|
|
|
13,935,761 |
|
Total operating expenses |
|
|
10,189,526 |
|
|
|
11,416,164 |
|
|
|
52,062,542 |
|
|
|
34,319,810 |
|
Loss from operations |
|
|
(10,189,526 |
) |
|
|
(11,416,164 |
) |
|
|
(52,062,542 |
) |
|
|
(34,319,810 |
) |
Other income
(expense): |
|
|
|
|
|
|
|
|
Interest income |
|
|
4,926 |
|
|
|
295,140 |
|
|
|
243,992 |
|
|
|
1,522,138 |
|
Foreign exchange gain (loss) |
|
|
566,890 |
|
|
|
406,033 |
|
|
|
481,719 |
|
|
|
(145,911 |
) |
Total other income (expense) |
|
|
571,816 |
|
|
|
701,173 |
|
|
|
725,711 |
|
|
|
1,376,227 |
|
Net loss |
|
$ |
(9,617,710 |
) |
|
$ |
(10,714,991 |
) |
|
$ |
(51,336,831 |
) |
|
$ |
(32,943,583 |
) |
|
|
|
|
|
|
|
|
|
Net loss per
share - basic and diluted |
|
$ |
(0.33 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.90 |
) |
|
$ |
(1.50 |
) |
|
|
|
|
|
|
|
|
|
Basic and
diluted weighted average shares outstanding |
|
|
29,299,233 |
|
|
|
23,191,428 |
|
|
|
27,022,931 |
|
|
|
22,000,203 |
|
|
|
|
|
|
|
|
|
|
Non-cash
stock-based compensation included above: |
|
|
|
|
|
|
|
|
Research and development |
|
$ |
604,603 |
|
|
$ |
456,420 |
|
|
$ |
2,194,888 |
|
|
$ |
2,371,998 |
|
General and administrative |
|
|
639,514 |
|
|
|
751,253 |
|
|
|
2,982,639 |
|
|
|
3,189,897 |
|
Total |
|
$ |
1,244,117 |
|
|
$ |
1,207,673 |
|
|
$ |
5,177,527 |
|
|
$ |
5,561,895 |
|
|
|
|
|
|
|
|
|
|
ZYNERBA PHARMACEUTICALS,
INC.CONSOLIDATED BALANCE SHEETS
|
|
December 31, 2020 |
|
December 31, 2019 |
|
Assets |
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
59,157,187 |
|
|
$ |
70,063,242 |
|
|
Incentive and tax receivables |
|
|
9,042,586 |
|
|
|
14,613,969 |
|
|
Prepaid expenses and other current assets |
|
|
5,166,401 |
|
|
|
2,378,812 |
|
|
Total current assets |
|
|
73,366,174 |
|
|
|
87,056,023 |
|
|
Property and
equipment, net |
|
|
585,403 |
|
|
|
362,724 |
|
|
Right-of-use
assets |
|
|
105,199 |
|
|
|
345,849 |
|
|
Total assets |
|
$ |
74,056,776 |
|
|
$ |
87,764,596 |
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
2,522,716 |
|
|
$ |
4,740,981 |
|
|
Accrued expenses |
|
|
11,280,843 |
|
|
|
7,073,506 |
|
|
Lease liabilities |
|
|
109,689 |
|
|
|
243,677 |
|
|
Total current liabilities |
|
|
13,913,248 |
|
|
|
12,058,164 |
|
|
Lease
liabilities, long-term |
|
|
— |
|
|
|
109,689 |
|
|
Total liabilities |
|
|
13,913,248 |
|
|
|
12,167,853 |
|
|
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
|
Common stock |
|
|
29,975 |
|
|
|
23,211 |
|
|
Additional paid-in capital |
|
|
262,286,008 |
|
|
|
226,409,156 |
|
|
Accumulated deficit |
|
|
(202,172,455 |
) |
|
|
(150,835,624 |
) |
|
Total stockholders' equity |
|
|
60,143,528 |
|
|
|
75,596,743 |
|
|
Total liabilities and stockholders' equity |
|
$ |
74,056,776 |
|
|
$ |
87,764,596 |
|
|
|
|
|
|
|
|
Zynerba Contacts
Jim Fickenscher, CFO and VP Corporate
DevelopmentZynerba
Pharmaceuticals484.581.7483fickenscherj@zynerba.com
Peter VozzoWestwicke/ICROffice: 443.213.0505Cell:
443.377.4767Peter.Vozzo@Westwicke.com
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