Zynerba Pharmaceuticals (NASDAQ:ZYNE) Inc has reported results for the first quarter that reveal ample cash on hand, giving the company scope to run pivotal trials of its flagship product Zygel (ZYN002).
As of March 31, 2022, the Devon, Pennsylvania-based company increased its cash and equivalents to $69.7 million, compared to $67.8 million at the end of December 2021.
For the period ended March 31, 2022, Zynerba received a payment of $8 million from the Australian Tax Office for research and development (R&D) incentives for the years ended December 31, 2018, 2019 and 2020.
READ: Zynerba presents positive data on Zygel in children with Fragile X at International Society for Autism Research meeting
Management believes the company's $67.8 million war chest will be “sufficient” to fund operations and capital requirements into the second half of 2023.
The company's flagship Zygel will be in focus for the rest of the year. The product is a patent-protected CBD skin gel, which is being developed to treat a slew of rare neuropsychiatric disorders, including Fragile X syndrome (FXS) and autism spectrum disorder (ASD) programs.
For the quarter, Zynerba reported R&D expenses of $5.1 million, including stock-based compensation of $0.5 million and admin expenses of $3.8 million. The company’s net loss for the quarter was $8.5 million, or $0.22 per basic and diluted share.
“We are excited by the opportunities ahead for Zygel in FXS and other rare and near-rare neuropsychiatric indications, and have made meaningful progress since the beginning of this year,” Zynerba CEO Armando Anido said in an earnings statement.
“Specifically, during 1Q 2022, we continued to enroll patients in our Phase 3 pivotal trial in patients with FXS, completed enrollment in our Phase 2 trial in patients with 22q11.2 deletion syndrome and advanced toward submission of an Investigational New Drug (IND) application for a Phase 3 trial in patients with ASD that we expect to initiate in the second half of 2022,” he added.
Zynerba told investors that it continues to expect topline results from RECONNECT, a confirmatory pivotal Phase 3 trial of Zygel in patients with FXS, in the second half of 2023. The company believes that the results from RECONNECT, if positive, will be sufficient to support the submission of a New Drug Application (NDA) for Zygel in patients with FXS, which causes mild to severe intellectual disability.
During the quarter, Zynerba received orphan drug designation for cannabidiol, the active ingredient in Zygel, for the treatment of FXS from the European Commission. The company believes that based on the scientific advice of the European Medicines Agency, the successful completion of the current development program for Zygel in FXS will satisfy the requirements of a marketing authorization application in the European Union.
In addition, during the quarter, Zynerba completed enrollment for the 14-week open-label Phase 2 INSPIRE trial in children and adolescents with genetically confirmed 22q, a disorder caused by a missing piece of the 22nd chromosome. The firm said it expects topline data from INSPIRE mid-year 2022. A total of 20 patients have been enrolled in the INSPIRE trial.
The company said it plans to move forward in 22q as an orphan indication pending results from the INSPIRE trial, and subsequent discussion with the US Food and Drug Administration (FDA) on the regulatory path forward. The company has previously received orphan drug designation from the FDA for cannabidiol, the active ingredient in Zygel, for the treatment of 22q.
Meanwhile, Zynerba noted that it is “finalizing the Phase 3 study protocol” for patients with autism spectrum disorder (ASD), a developmental disability caused by differences in the brain. The company expects to initiate the first of two Phase 3 trials in patients with ASD in the second half of 2022.
Zygel is the first and only patent-protected cannabidiol clear gel, designed to provide controlled drug delivery into the bloodstream through the skin, according to the company. It is a potential goldmine of therapies for Fragile X syndrome and other conditions.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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