Zymeworks Inc.

Thank you for standing by. This is the conference operator. Welcome to DesignWorks' first quarter 2025 results conference call and webcast. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To ask a question, Thank you, Operator, and good afternoon, everyone. Thanks for joining our first quarter 2025 results conference call.

Before we begin, I would like to remind you that we will be making a number of forward-listening statements during this call, including without limitation those forward-listening statements identified in our slides in the accompanying oral commentary. Forward-looking statements are based upon our current expectations and various assumptions and are subject to the usual risks and uncertainty associated with companies in our industry and at our stage of development. For a discussion of these risks and uncertainties, we refer you to our latest SEC filings as found on our website and as far as the SEC. In a moment, I'll be handing over to Leonie Paterson, our Executive Vice President and Chief and Business Officer who will be discussing recent business updates along with the financial results for our first quarter 2025. Following this, Dr. Paul Moore, our Chief Scientific Officer, will give an overview of our recent R&D developments, including highlights from our poster presentations at the American Association for Cancer Research. At the end of the call, Leonie, Paul, and Ken Galbraith, our Chair and CEO, will be available for Q&A, along with Dr. Sabine McCann, our recently appointed Senior Vice President of Clinical Development As a reminder, the audio and slides from this call will also be available on the TimeWorks website later today. I will now turn the call over to you.

Thank you, Chanel, and thank you all for joining us today. I'm pleased to walk you through our corporate and operational highlights for the first quarter of 2025. I'd like to begin by emphasizing that our performance this quarter reflects the discipline, focus, and resilience of our business model. In a dynamic environment for innovative biotech companies, we continue to execute against our long-term strategy and deliver meaningful progress across our portfolio. Our programs are moving towards clear, measurable clinical milestones, with near-term opportunities to validate our technology platforms in meaningful patient populations globally. Throughout this period of continued progress, we have demonstrated our ability to operate at a high standard and provide value to shareholders while prudently managing our cash burn. We are also able to manage our cash burn going forward through active review and evaluation of our portfolio and development priorities. With this in mind, and as previously highlighted by our management team, we are committed to an evidence-based approach to pipeline management where decisions on investment and clinical development are tied to clear clinical and scientific validation. On the research and development front, we are honored to have our Holyon pipeline represented at AACR annual meeting with six posters on preclinical data presented across our antibody drug conjugate and T cell engager pipeline. Paul will be taking us through key highlights from these posters later on today's call. We are also looking forward to presenting more preclinical data on our Holyon pipeline at several upcoming medical conferences in the second quarter, including the American Thoracic Society annual meeting, where an abstract has been accepted for ZW1528, our novel IL-4 or IL-33 bispecific molecule. We will also be attending ASCO and ESMO gynecological cancer annual meetings, where we will be presenting trial and progress posters on ZW171 and GW191, respectively. Similarly, our partner, Jazz, is also planning to present on these accepted abstracts, on three, sorry, accepted abstracts at ASCO on Xanadatamab, including a four-year follow-up of the phase two of Xanadatamab and metastatic DEA, which will provide further understanding of the long-term outcomes and overall survival for Xanadatamab plus chemotherapy in HER2-positive advanced patients with metastatic GEA. This progress is further reflected in our announcement from JAS in April 2025 that the EMEA Committee for Medicinal Products for Human Use, or CHMP, has adopted a positive opinion recommending the approval of Xanadatamab for treatment of advanced HER2-plus biliary tract cancer patients. A final decision is expected in the coming months Importantly, if approved, this could also represent an opportunity for an increase in royalty revenue for ZymeWorks in the near future. We are also looking forward to the upcoming presentation by Jane Jay at ASCO, highlighting their Phase 1 data for a bispecific T-cell engager engineered utilizing our asymmetric platform, targeting a novel target, KLK2, in metastatic castration-resistant prostate cancer. Some of you might have seen the preliminary data at AACR last week and were encouraged by the early clinical activity and safety profile observed to date. It's rewarding to see this program move forward, especially with such a difficult to treat patient population in need of novel targets. As a reminder, under the terms of the agreement in place with J&J for this product, the company remains eligible to receive development milestones of up to $86 million, commercial milestone payments of up to $373 million, and mid-single-digit royalties on commercial sales. Turning to our financial position this afternoon, Zineworks reported financial results for the first quarter of 2025. Zineworks net loss for the three months ended March 31, 2025, was $22.6 million, and compared to a net loss of $31.7 million for the same period in 2024. The decrease in net loss was primarily due to an increase in revenue, which was partially offset by an increase in operating expenses, an increase in income tax expense, and a decrease in interest income. As reported, our revenue for the three months ended March 31, 2025 was $27.1 million compared to $10 million for the same period in 2024. Revenue for the three months ended March 31, 2025 included $14 million of milestone revenue from GSK in relation to a clinical milestone under our 2016 platform technology transfer and license agreement. $3.1 million of milestone revenue from Daiichi Sankyo following the first patient dose in a clinical trial related to our 2018 license agreement. $9.6 million for the development support and drug supply revenue in addition to the $0.2 million of royalty income from JAS and $0.2 million of drug supply revenue from Beijing. These achievements underscore the strength of our foundational partnerships and the relevance of our platform across multiple products moving into clinical development by our partners. We are also hopeful that continued development by our collaboration partners will provide a future source of revenues for us. These revenues also reflect growing momentum for Zahira and demonstrate the value of our partnership strategy in expanding patient reach while helping us improve our financial efficiency. Overall, operating expenses were $52.7 million for the three months ended March 31, 2025, compared to $47.3 million for the same period in 2024, representing increase of 10%. Research and development expense was $35.7 million for the three months ended March 31, 2025, compared to $32 million for the same period in 2024. primarily driven by an increase in ZW251 and other preclinical research expenses, partially offset by reductions in costs on Xanadatabab, Xanadatabab-Zovitotin, and ZW191 and ZW220. General and administrative expenses was $17 million for the three months ended March 31, 2025, compared to $15.8 million for the same period in 2024, primarily due to an increase in stock-based compensation expense. As of March 31, 2025, we had $321.6 million of cash resources consisting of cash, cash equivalents, and marketable securities, as compared to $324.2 million as of December 31, 2024. We remain well capitalized and based on our current operating plans, we expect our existing cash resources as of March 31, 2025, when combined with the assumed receipt of certain anticipated relative milestones, will enable us to fund planned operations as the second half of 2027, which should take us through multiple catalysts in our pipeline. For additional details on our quarterly results, I encourage you to review our earnings release and other SEC filings as available on our website at www.zymeworks.com. With that, I'd like to hand over to our Chief Scientific Officer, Dr. Paul Moore.