Zymeworks Inc. ZYME-Q stock hit its highest level in four years Monday, on news that the clinical-stage biotechnology company’s lead drug had proven effective in controlling the spread of a digestive system cancer.
The Vancouver-based company’s drug Ziihera, when combined with chemotherapy “demonstrated highly statistically significant and clinically meaningful improvements” in prolonging the period in which patients with the cancer don’t experience a worsening or spread of the disease, Zymeworks said in a release. The results, from a late-stage human efficacy trial, were also shared by Jazz Pharmaceuticals plc JAZZ-Q, one of its two commercialization partners.
The improvement compared to the standard of care relates to advanced metastatic gastroesophageal adenocarcinoma (GEA), a cancer affecting the esophagus, stomach and junction between them.
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Neither Jazz nor Zymeworks disclosed data from the ongoing trial. But Dublin-based Jazz, which has partnered with Zymeworks to take the drug to market in North America, Europe and Japan, said it planned to submit the data for presentation at a major medical meeting and for publication in a peer-reviewed journal next year.
The results “represent a true turning point for patients” with GEA, Zymeworks CEO Kenneth Galbraith said in a release. He added those afflicted with the ailment have “historically had limited treatment options and poor outcomes.”
Zymeworks shares closed up 29 per cent Monday, ending the day at US$23.90 on the Nasdaq. Zymeworks shares last reached that level in November, 2021, before tumbling to around $5 less than a year later. Jazz shares, meanwhile, rose almost 21 per cent to US$170.09.
Monday’s news is the second significant development for Zymeworks in a year. Last November, it joined the slender ranks of Canadian drug developments approved for the lucrative U.S. market, when Ziihera got the nod from the U.S. Food and Drug Administration to treat adults with a form of biliary-tract cancers, which start in the gallbladder or bile duct.
It’s a rare cancer that typically comes with a poor prognosis. The drug is the first bispecific antibody – a laboratory-created antibody which can bond to two targets, improving the body’s immune response – and chemotherapy-free treatment for patients with the condition.
But while that approval unlocked a modest market with anticipated peak sales of tens of millions of dollars, the number of patients that could benefit from Ziihera in GEA could be 20 times larger, said David Martin, an analyst with Bloom Burton & Co. in Toronto. “This looks like a winner as well,” he said.
Zymeworks has found its footing after bottoming out in 2022. Investors had begun to doubt the company after it posted weak results for one of its lead drugs and other pharma companies delivered strong results for products rivalling Ziihera.
The company, which had developed a platform to create a range of cancer-fighting antibodies, replaced co-founder and CEO Ali Tehrani with Mr. Galbraith and successfully fended off an opportunistic low-ball takeover bid by a hedge fund. Mr. Galbraith set a new course for Zymeworks by striking the Jazz deal, transferring the risk and development costs for its lead drugs to the pharma giant.
His plan was to use those proceeds to fund development of a pipeline of cancer drugs. His goal was to bring five new medicines to the clinic within five years, although Zymeworks recently halted development of a Ziihera offshoot targeting non-small-cell lung cancer due to rising competition.