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Zynerba Pharmaceuticals Reports Third Quarter 2018 Financial Results and Operational Highlights

DEVON, Pa., Nov. 08, 2018 (GLOBE NEWSWIRE) -- Zynerba Pharmaceuticals, Inc. (ZYNE), the leader in innovative pharmaceutically-produced transdermal cannabinoid therapies for rare and near-rare neuropsychiatric disorders, today reported financial results for the third quarter ended September 30, 2018 and provided an overview of recent operational highlights.

“The momentum we established in the first half of 2018 continued through the third quarter,” said Armando Anido, Chairman and Chief Executive Officer of Zynerba. “We began enrolling patients into CONNECT-FX, our pivotal study in Fragile X syndrome and we expect to complete enrollment in BELIEVE-1, our Phase 2 study in developmental and epileptic encephalopathies, before year end. With our third quarter 2018 follow-on offering, we are well capitalized and expect our current cash to take us through the presentation of top line data for both of these studies.”

Third Quarter 2018 and Recent Highlights

ZYN002 in Fragile X Syndrome (FXS)

Initiated CONNECT-FX, a Pivotal Clinical Trial of ZYN002 in FXS

Enrollment is progressing in CONNECT-FX (Clinical study of Cannabidiol (CBD) in Children and Adolescents with Fragile X), a pivotal, multi-national, randomized, double blind, placebo-controlled study evaluating the efficacy and safety of ZYN002 in three to 17-year old FXS patients with full mutation of the FMR1 gene. The primary endpoint is the change from baseline to the end of the treatment period in the Aberrant Behavior Checklist-Community FXS Specific (ABC-CFXS) Social Avoidance subscale. Top line data are expected in the second half of 2019; there are currently no approved products indicated for FXS.

Presented New Data at the 16th NFXF International Fragile X Conference from the Ongoing Open Label FAB-C Phase 2 Study of ZYN002

Zynerba presented new data demonstrating that treatment with ZYN002 improved core behavioral symptoms of FXS with statistical significance versus baseline across multiple measures of efficacy at week 12, and these improvements were sustained through 38 weeks of treatment. For example, significant improvements vs. baseline in social avoidance as measured by the ABC-CFXS were demonstrated at 12 weeks (58%; p=0.0040) and 38 weeks (75%; p=0.0013) of treatment with ZYN002.

Poster Accepted for Presentation at the 57th Annual Meeting of the American College of Neuropsychopharmacology (ACNP)

The poster presentation is on Wednesday, December 12, 2018 in poster session III from 5:30 PM to 7:30 PM EST. The meeting will be at the Diplomat Beach Resort in Hollywood, Florida from December 9 through 12, 2018.

ZYN002 in Developmental and Epileptic Encephalopathies (DEE)

Enrollment Nearing Completion in the Phase 2 BELIEVE 1 Clinical Trial in DEE; Topline Results Expected in 2019

Enrollment is progressing in BELIEVE 1 (Open Label Study to Assess the Safety and Efficacy of ZYN002 Administered as a Transdermal Gel to Children and Adolescents with Developmental and Epileptic Encephalopathy). This is a six-month multi-dose Phase 2 clinical trial evaluating the efficacy and safety of ZYN002 in approximately 50 children and adolescents with DEE, a category of epilepsy syndromes that involve significant developmental impairment or regression of developmental progress, and are highly resistant to treatment. The Company expects to complete enrollment by year-end 2018.  

ZYN002 in Focal Epilepsy

STAR-2 Long-Term Data Accepted for Poster Presentation at the 2018 Annual Meeting of the American Epilepsy Society (AES)

The poster presentation is on Sunday, December 2, 2018 in poster session 2 from 12:00 PM to 2:00 PM EST. The meeting will be at the Ernest N. Morial Convention Center in New Orleans, LA from November 30 to December 4, 2018. The poster will highlight efficacy and safety data from adult patients with refractory focal epilepsy receiving treatment with ZYN002 for up to 18 months. These data contribute to the design of the upcoming double blind, placebo-controlled Phase 2b study, which the Company expects to initiate in the fourth quarter of 2018.

Corporate

Completed Successful $30 Million Follow-on Offering

The Company improved its capital structure through a completed follow-on offering, resulting in net proceeds of $29.9 million after deducting underwriting discounts and commissions and offering expenses.

Third Quarter 2018 Financial Results

As of September 30, 2018, cash and cash equivalents were $66.2 million, compared to $62.5 million as of December 31, 2017. Research and development expenses for the third quarter of 2018 were $4.9 million, including stock-based compensation of $0.7 million. General and administrative expenses for the third quarter of 2018 were $3.1 million, including stock-based compensation expense of $0.8 million. Net loss for the third quarter of 2018 was $7.8 million with basic and diluted net loss per share of $(0.47).

Financial Outlook
The Company’s cash and cash equivalent position as of September 30, 2018 was $66.2 million, which management believes is sufficient to fund operations and capital requirements into the first half of 2020.

About Zynerba Pharmaceuticals, Inc.
Zynerba Pharmaceuticals is the leader in 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 and refractory epilepsies. 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 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; and the Company’s expectations regarding its ability to obtain and adequately maintain sufficient intellectual property protection for its product candidates. 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 September 30,    Nine months ended September 30,   
      2018       2017       2018       2017    
Operating expenses:                  
Research and development   $   4,859,902     $   5,753,764     $   22,368,881     $   16,978,016    
General and administrative       3,125,780         2,795,839         9,982,743         7,640,489    
Total operating expenses       7,985,682         8,549,603         32,351,624         24,618,505    
Loss from operations       (7,985,682 )       (8,549,603 )       (32,351,624 )       (24,618,505 )  
Other income (expense):                  
Interest income       278,214         161,930         639,702         363,350    
Foreign exchange (loss) gain       (99,897 )       76,468         (409,010 )       361,450    
Total other income (expense)       178,317         238,398         230,692         724,800    
Net loss   $   (7,807,365 )   $   (8,311,205 )   $   (32,120,932 )   $   (23,893,705 )  
                   
Net loss per share - basic and diluted   $   (0.47 )   $   (0.63 )   $   (2.21 )   $   (1.87 )  
                   
Basic and diluted weighted average shares outstanding     16,587,353         13,098,914         14,531,272         12,743,332    
                   
Non-cash stock-based compensation included above:                  
Research and development   $   743,153     $   591,898     $   2,267,783     $   1,722,456    
General and administrative       841,077         1,130,745         2,759,330         2,544,260    
Total   $   1,584,230     $   1,722,643     $   5,027,113     $   4,266,716    
                   

 

   
ZYNERBA PHARMACEUTICALS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
 
           
    September 30, 2018   December 31, 2017  
Assets          
Current assets:          
Cash and cash equivalents    $   66,177,376     $   62,510,277    
Incentive and tax receivables       3,095,195         3,983,604    
Prepaid expenses and other current assets       3,413,029         1,733,701    
Total current assets       72,685,600         68,227,582    
Property and equipment, net       248,741         164,527    
Other assets       —         662,200    
Total assets   $   72,934,341     $   69,054,309    
Liabilities and Stockholders' Equity          
Current liabilities:          
Accounts payable   $   3,553,350     $   3,355,255    
Accrued expenses       5,415,742         3,915,491    
Deferred grant revenue       171,975         171,975    
Total current liabilities       9,141,067         7,442,721    
Deferred grant revenue, long-term       —         662,000    
Total liabilities       9,141,067         8,104,721    
           
Stockholders' equity:          
Common stock       17,623         13,554    
Additional paid-in capital       173,877,449         138,916,900    
Accumulated deficit       (110,101,798 )       (77,980,866 )  
Total stockholders' equity       63,793,274         60,949,588    
Total liabilities and stockholders' equity   $   72,934,341     $   69,054,309    
           


Investor Contacts

Jim Fickenscher, CFO and VP Corporate Development
Zynerba Pharmaceuticals
484.581.7483
fickenscherj@zynerba.com

Will Roberts, VP Investor Relations and Corporate Communications
Zynerba Pharmaceuticals
484.581.7489
robertsw@zynerba.com