Zymeworks Inc.

Good day and thank you for standing by. Welcome to ZymeWorks first quarter 2026 results conference call. At this time, all participants are in the listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during your session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, Please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Chanel Inmadar, VP of Investor Relations. Your line is open.

Thank you, Operator. Good afternoon, everyone, and thank you for joining our first quarter 2026 results conference call. As usual, I'd like to remind you that we'll be making a number of forward-looking statements during this call, including without limitation those forward-looking statements identified on our slides and the accompanying oral commentary. These forward-looking statements are based upon our current expectations and various assumptions and are subject to the risks and uncertainties including those associated with companies in our industry and at our stage of development. For a discussion of these risks and uncertainties, we'll refer you to our latest SUT filings as found on our website and as followed by the SUT. In a moment, I'll hand over the call to Ken Galbraith, our Chair and CEO, who will provide an overview of recent business updates. Ken will then hand the call over to Kristen Stafford, our Chief Financial Officer, to discuss our cash position and financial results for the first quarter of 2026. Dr. Paul Moore will then provide a brief summary of new preclinical data disclosed at AACR on our PAN RAS ABCs. And following this, Dr. Sabine Mikan, our SVP and Chief Medical Officer, will provide progress updates on both the Phase 1 clinical trial of CW191 and CW251. At the end of the call, Ken, Kristen, Sabine, and Paul will be joined for a Q&A session with Scott Pashton, our Chief Business Officer, and Adam Shaywitz, Head of R&D. As a reminder, the audio and slides from this call will also be available on the Climber website later today. I'll now hand the call over to Ken.

Thank you, Chanel, and good afternoon, everyone. We're pleased to be reporting on further progress this quarter on both our wholly owned and partnered assets. The PDUFA date of August 25th, 2026 for Xanadatamab and first-line GEA in the U.S., together with the completion of an SPLA filing in China for first-line GEA, marks an important inflection point in near-term foundational value-driving opportunity for Zymorx. These regulatory milestones provide increasing visibility toward commercialization in first-line HER2-positive GEA and accompany continued clinical development in additional settings, such as breast cancer, helping to establish a clear baseline for Xanadatamab's value. If you didn't get a chance to tune in, we'd urge you to listen into Jazz's disclosures within their earnings call earlier this week on preparedness and launch activities for GEA in anticipation of an FDA approval later this year on or before the PDUFA date. With our partners Jazz and B1 bringing established commercial capabilities, we believe Santa Data Map is well positioned to translate potential approvals and label extensions into meaningful uptake significant milestone payments, and durable royalty revenues. This includes near-term milestone payments of $250 million upon approval in the U.S. for GEA from Jazz and $15 million upon approval in China for GA from B1. Importantly, this momentum also illustrates the broader strength of our business model. Recent data presented at the American Association for Cancer Research annual meeting, alongside this continued regulatory progress for Zandatamab, reinforce the strategic advantage of integrating our R&D portfolio with royalty participation within a single organization. We will continue to be intentional about maintaining a portion of our R&D portfolio unencumbered, preserving optionality for future transactions, and aiming to capture upside beyond structured royalty streams. Advances across our ADC portfolio at ADCR, including the presentation of three new preclinical RAS-targeting ADC candidates featuring proprietary payloads, as well as encouraging phase one data for ZW191, highlight the scalability of our platform and its ability to generate multiple potential future value drivers. Taken together, we believe this integrated model, anchored by near-term catalysts, such as potential global approvals for Zeta DataMap, and supported by a productive and innovative pipeline that provides future optionality for our emerging royalty portfolio, positions us to deliver durable compounding returns for shareholders over time. Over the past quarter, we've also strengthened our leadership team with the addition of Kristen and the full-time appointments of Scott and Adam, who bring deep experience in strategic capital allocation, investment, and dealmaking. Also pleased to announce the appointment today of Mr. Paul Schneider, who joins us as General Counsel from Pfizer. All of these appointments enhance our ability to systematically identify, structure, and execute opportunities that align with our long-term value creation framework. With that, I'd like to hand the call over to Kristen, who will provide an overview of our financial highlights for the first quarter of 2026.

Thank you, Ken. Having now spent my first month at Zymworks, what stands out for me is the potential for us to build a novel strategy of royalty aggregation and growth, one that's differentiated by the integration of our productive R&D engine with a quality portfolio of royalty interest. My focus as I step into this role is to ensure we execute with discipline, particularly in how we allocate capital, prioritize programs, and pursue external opportunities. That includes maintaining a high bar for investment, strengthening operational rigor, and leveraging our integrated model to drive both near-term visibility and long-term compounding value. I'm excited to join the team to build on this momentum and to position ZymeWorks as a leader in this emerging model. As part of this, we're evaluating ways to potentially evolve our financial reporting in order to provide better visibility into returns on invested capital and the performance of both our R&D and royalty portfolios. We intend to build on the OPEX framework we introduced last quarter, adding greater transparency around how that investment translates into key value drivers for shareholders. I'll now talk through the financial results for the first quarter of 2026. Total revenue was $2.4 million for the three months ended March 31, 2026, compared to $27.1 million for 2025. The decrease was driven mainly by the achievement of non-recurring clinical milestones in 2025, as well as continued declines in development support and drug supply revenue from JEV. Revenue in the current year period reflects ongoing collaboration activity and increased royalty revenue, which is expected to grow over time as commercial sales of Zahara increase. Overall operating expenses were $49.5 million for the three months ended March 31, 2026, compared to $52.7 million for 2025. The decrease in research and development expenses was primarily driven by lower third-party program costs following reduced activity on later stage and discontinued programs, partially offset by increased investment in early stage clinical and preclinical programs, as well as increased unallocated costs related to leadership transition. The decrease in general and administrative expenses was primarily driven by lower professional fees, consulting, and information technology-related costs, partially offset by higher salaries and benefits reflecting the previously disclosed leadership transition. Net loss was $44.2 million for the three months ended March 31, 2026, compared to a net loss of $22.6 million in 2025. The change in 2026 was primarily due to a decrease in revenue driven by the non-recurring clinical milestones earned in the first quarter of 2025. Despite the year-over-year change in earnings, we ended the quarter with a strong cash position, providing flexibility to fund operations and execute on our capital allocation strategy. Turning to capital allocation, we've made progress on our share repurchase program, which reflects our commitment to discipline capital allocation and enhancing long-term shareholder returns. As of May 6, 2026, the company has utilized approximately $95.8 million of the approved $125 million repurchase program to acquire 3,930,734 shares at an average price of $24.37 per share, exclusive of commission expense and estimated excise tax. As of May 6, 2026, the company had approximately 73 million common shares outstanding. As of March 31, 2026, we had $403.8 million of cash resources consisting of cash, cash equivalents, and marketable securities compared to $270.6 million as of December 31, 2025. Based on our current operating plans and assuming full execution of the $125 million share repurchase plan, we expect our existing cash resources as of March 31, 2026, when combined with anticipated regulatory milestone payments of $440 million related to the potential approvals of Zahara and GEA in the U.S., Europe, Japan, and China to fund our planned operations beyond 2028. This anticipated cash runway does not take into account any contribution from additional future milestone payments or royalties related to Zahara or other current licensed product candidates or contributions from future partnerships and collaborations. additional details on our quarterly results i encourage you to review our earnings release and other sec filings available on our website at www.zineworks.com i will now pass the call over to paul who will provide a summary of our pre-clinical presentations at aacr thank you kristin uh well it certainly has been another busy aacr for zineworks with six poster presentations

a neural presentation for ZW191, and two invited talks from our research leadership team, one covering multispecifics and the other ADCs. For the call today, I wanted to focus on the Pan-RAS ADC platform that we unveiled at AACR, which has attracted a lot of attention over the last few weeks. You may recall at our R&D day at the end of 2024, we first outlined our plans to pursue novel payloads and so it is particularly satisfying to now see that intention translated into clear execution. Against that backdrop, the decision to focus on RAS payloads reflects both the strength of the screening outcomes and the quality of the candidates identified. It marks a meaningful step forward in delivering on the strategic direction originally outlined. As you're aware, we have also been encouraged by the continued translation of our proprietary topo payload, purpose-built for ABCs, from the preclinical setting into the clinic, which Sabine will talk about in a few minutes. Based on that foundation, our focus has been on what comes next. As we think about the next generation of ADCs, we've been intentional in addressing certain core aspects, deploying additional mechanisms of action through payload selection, enhancing efficacy, overcoming resistance, and further improving safety. These priorities have guided our investment in both novel targets and novel payloads, particularly as resistance can emerge through multiple mechanisms, including target evolution or following sequential ADC treatments. In parallel, RAS inhibitors have generated significant interest given recent developments in the field. However, toxicity remains a key limitation. We believe an ADC-based approach offers a compelling way to address this by improving targeting and enabling more sustained tumor exposure with the potential to enhance efficacy while reducing systemic side effects. this profile may also better support combination strategies. To explore this, we generated and functionally screened more than 170 novel pan-RAS inhibitors derived from our scaffold work in-house. Our thesis for our topopayload, our selection criteria extended beyond potency alone. We prioritized molecules with properties best suited for an ADC modality, and as shown in this slide, supported potent efficacy in xenograft models, favorable pharmacokinetics, meaningful bystander activity, and a tolerability profile in non-human primates that are collectively supportive of further development. From a safety perspective, our lead payload candidate, evaluated in the context of a LI-6E pan-RAS ADC, demonstrated encouraging results in non-human primates with no observed body weight loss, skin toxicity, or GI tox at doses up to 120 mg per kg, representing the maximum dose test that's The dataset on this slide also highlights the ability of an ADC approach to sustain tumor-targeted inhibition of the Ras pathway over an extended period, and how it differentiates both in distribution and biological effect to a pan-Ras small molecule inhibitor delivered orally. Following a single dose of Ras ADC in a mouse xenograft model, we observed sustained accumulation of the Ras payload in the tumor at levels higher relative to that observed in normal organs. This differential exposure is also reflected in the durable RAS pathway inhibition as measured via DUSP6 levels in the tumor out to 14 days, with, again, clear differentiation between tumor and normal tissue. In contrast, while the small molecule pan-RAS inhibitor delivered orally achieves RAS pathway inhibition, the magnitude of inhibition in tumors overlaps with that observed in normal tissues such as skin, liver, and colon. consistent with the broader distribution and uptake pattern of the small molecule, as shown in the top right, relative to the tumor targeted design of the Pan-RAS ADC. Again, for the Pan-RAS ADC, what we see is a more selective inhibition of the RAS pathway in tumor relative to skin, in contrast to the small molecule that shows activity across both skin and GI, aligning with the tox profile observed clinically for Pan-RAS inhibitors. Taken together, we believe this differentiation underscores the potential for ADCs to fundamentally reshape how RAS targeted therapies can be deployed in patients. As far as the mechanism goes, we have not divulged full details, but it is a RAS-on inhibitor. Our focus so far has been on the functional behavior of the molecules and how the overall design translates into pathway modulation and tolerability. At AACR, we presented also on the application of this platform across three different therapeutic candidates. We chose our targets with intent to reach deeply into cancers where RAS mutations drive disease at scale, including non-small cell lung cancer, pancreatic cancer, and colorectal cancer, ensuring both relevance and impact. All candidates incorporate the bystander active pan-RAS payload at DAR-8. While on the antibody side, we will leverage our antibody engineering expertise to optimize internalization, tumor penetration, and kinetic properties that ultimately determine whether this modality delivers on its promise to provide target-driven tumor-selective RAS inhibition. The candidates, as you can see here, include ZW439, a clodin 18.2 targeting pan-RAS inhibitor, ADC for the treatment of RAS-mutated pancreatic cancer, ZW427, a LIHC6E-targeting antibody drug conjugate bearing a novel pan-RAS inhibitor payload for the treatment of RAS-mutated cancers, including colorectal, pancreatic, and non-small-cell lung cancer. And ZW418, a bipartotopic PTK7-targeting ADC incorporating the same RAS inhibitor payload for the treatment of non-small-cell lung cancer. The data we've seen so far across the three candidates targeting PTK7, LIFE6E, and CLAUDIN18.2 respectively that we shared at AACR reinforces both the design of the payload and the broader principles underpinning our ADC platform. I'll leave it there for now and happy to go into more detail during the Q&A session. Sabine, I will now hand over to you to run through the updates on our clinical development program for 191 and 251.

Thank you, Paul. As the data presented at AACR, we observed strong anti-tumor activity for ZW191 across both ovarian and endometrial cancers. Starting with ovarian cancer, we observed tumor regression of at least 30% in 68% of patients, and importantly, some degree of tumor shrinkage in 85% of patients. Disease control was achieved in 94% of patients with an overall response rate of 56% across all those levels. When we look at the clinically relevant dose range of 6.4 to 9.6 milligram per kilogram, disease control was observed in all patients with a confirmed ORR of 61%. It is important to underscore that this ovarian cohort represents a particularly challenging population who are heavily pretreated. All of these patients were resistant to prior platinum therapy. Majority had prior PARP inhibitor exposure, and there was no limit to the number of prior lines of therapy. This makes cross-trial comparisons difficult, and in our view, highlights the strength of the anti-tumor activity of CW19Y. In relapsed or refractory endometrial cancer, we observed tumor regression of at least 30% and 50% of patients, with 70% experiencing some degree of tumor shrinkage. Disease control was achieved in 80% of patients with an overall response rate of 40% across all dose levels. At 6.4 to 9.6 milligram per kilogram dose range, ORR increased to 57% with disease control in 86% of patients. Across both tumor types, responses were observed starting at 3.2 milligram per kilogram dose, and importantly, activity was seen regardless of FR-alpha expression level, including in low or negative tumors. Median follow-up time was approximately seven months, with a number of patients still on treatment, supporting the durability of signals we have discussed. Turning to safety. ZW191 is being evaluated at meaningfully higher doses than some of the programs in this space. Regardless, we're pleased with the safety profile we're observing at these doses, which mainly consists of Cytopain-enhanced and GI events at low rates that are very manageable and types of events that are in line with the topo-ADC class. Importantly, no unexpected or new safety signals were observed with longer follow-up. These 6.4 and 9.6 milligram per kilogram doses are being further evaluated in a larger data set in dose optimization. As previously reported, this approximately 60 patient cohort is fully enrolled, and the results should assist in defining the optimum dose to move forward into subsequent clinical studies. Given the consistency of efficacy across the active dose range, we believe we have the flexibility to optimize dose to further refine tolerability without compromising activity. We also believe the profile remains compatible with combination approaches with appropriate dose selection and monitoring. At AACR, we presented a poster on preclinical combinations with DW191. In non-clinical studies, CW191 demonstrates activity across all levels of FR-alpha expression and shows promising combination potential with standard of care therapies supported by a favorable tolerability profile. These data provide an important translational foundation for the clinical observations of activity in low and negative FR-alpha expressing tumors and support the breadth of activity we're beginning to see emerge in the clinics. In addition, the combination data reinforced the potential to position ZW191 in earlier lines of treatment. We believe these combinations should be feasible with appropriate dose selection and monitoring. Overall, we view these data as supporting a compelling and increasingly well-defined benefit-risk profile for ZW191. We look forward to the opportunity to present additional updates on our Phase 1 study at future medical meetings, including at Esmogain in Denmark during June, where we will be presenting efficacy analysis by folate receptor alpha expression levels from the Phase 1 study. I also want to touch briefly on the protocol updates for our ongoing trial for ZW251. As we think about expansion opportunities beyond our initial indication for hepatocellular carcinoma, GPC3 expression provides a compelling biological rationale across multiple tumor types. Across published data sets, we see GPC3 expression in approximately 86% of hepatocellular carcinoma, and more broadly in a range of 60 to 100% depending upon the tumor subtype, staining methodology, and patient population. Notably, in squamous non-small cell lung cancer, GPC3 expression has been observed in roughly 60% of tumors, which supports the inclusion of squamous non-small cell lung cancer as a relevant population for further exploration. We're also exploring germ cell tumors where high GPC3 expression has been reported, particularly in non-geomanimative subtypes such as yolk sac tumors and choriocarcinoma. While pediatric germ cell tumors are relatively rare, expanding into adult germ cell tumors meaningfully broadens the addressable population and introduces more heterogeneous mixed histologies. Importantly, in these mixed tumor settings, the bystander effect associated with our ADC may be particularly relevant as it has the potential to address both GPC3 positive and adjacent antigen lower negative tumor cells within the same lesion. In our phase one study, we're assessing GPC3 expression retrospectively from available tumor samples. This approach allows us to better understand the distribution of GPC3 expression across tumor sites without restricting enrollment and helps inform future patient selection strategies. Overall, we believe the addition of these tumors positions us to efficiently map GPC3 expression across tumor types and identify those settings where the biology and mechanism of action are best aligned. Our phase one dose escalation study continues to recruit on schedule, and we look forward to having the opportunity to share the clinical data at the appropriate time at a future medical meeting. I'll now hand the call back to Ken to provide foreclosing remarks.

Yeah, thank you very much, Sabine. Looking ahead at the potential catalyst for 2026, we remain on track to deliver on the majority of these objectives and continue to see opportunities for a steady cadence of data and pipeline progress. As I mentioned earlier with the near-term U.S. PDUFA dates set for Xanadatamab and the SPLA submission in China, CYMORX has a greater visibility to near-term milestone payments from JASB1 and more meaningful royalty revenues upon potential launches in the U.S. and China. We also continue to follow progress from our collaboration partner, J&J Innovative Medicines, with respect to their broad clinical development program for Presvitamig, a novel KLK2 T-cell engager for prostate cancer patients. I do want to highlight that we are now guiding to an IND in 2027 for ZW1528 compared to our prior expectation of 2026. As we've continued to evaluate the All33 biology across the competitive landscape, we see an opportunity to further deepen our understanding and refine the clinical development strategy as recent clinical data outcomes are disclosed at upcoming medical meetings. Given the novelty of the target, we believe taking this additional time positions us to enter the clinic with a more focused and differentiated plan. However, the core preclinical package, including GLP toxicology, is largely complete and compelling. More broadly, we're also evaluating how partnerships and collaborations can support the advancement of our R&D pipeline. As we think about capital allocation and execution, we do see opportunities to bring in external partners, where in doing so, we can enhance speed, scale, or probability of success. We remain very encouraged by the progress of ZW209, as well as the broader Tri-TCE portfolio behind it. ZW209 is IND-ready and still maintained as a potential IND in 2026, which we believe should provide confidence in both the maturity of the program and its underlying safety profile. We have multiple additional targets in development within the Tri-TZ platform and may continue to view this as a key driver of long-term value. We've demonstrated our ability to repeatedly extract high-quality assets from a single platform. Our asymmetric platform enabled the development of Zendatamab, supported partner programs such as PASRETA-MIG, and continues to drive our wholly-owned pipeline, including our topo-ADC programs built on optimized antibodies and our RAS-targeting ADC candidates, as well as our multi-specific antibody product candidates behind ZW209 and ZW1528. Importantly, we believe this capability is transferable beyond our internally-generated R&D pipeline. We have the ability to supplement and scale our existing capabilities through acquisitions, rapidly apply our technologies, and efficiently advance novel candidates into the clinic. as we've consistently demonstrated. We've been very active in external processes to assess potential acquisitions and feel well-funded to do so with the proceeds of the Royalty Pharma Note and the upcoming expected GEA approval milestones and enhanced royalty income from Zendata MAP. But we are also remaining disciplined in our approach to acquisitions to ensure we find the right opportunities for our long-term strategic objectives and the right price. At the same time, our capital allocation framework remains disciplined and highly focused on per share value creation. Since initiating our share repurchase program in 2024, we've retired approximately 8.3 million shares through the deployment of roughly 155.8 million in capital for a weighted average repurchase price of approximately $18.70 per share. This represents over 10% of our common shares outstanding. Notably, our average repurchase cost remains at a meaningful discount to today's share price, reinforcing our view that these buybacks have represented an attractive and accretive use of capital on behalf of shareholders. Over time, repurchases are designed to continue to reduce our share count while increasing each remaining shareholder's participation in the future economics of the business. We believe these repurchases have represented an attractive use of capital given the disconnect we've seen between our market valuation and the long-term value of our commercial royalty interests and development pipeline. This balanced approach of pairing growing and durable royalty revenues with opportunistic share repurchases and a disciplined investment is designed to enhance intrinsic value per share and support increasing total shareholder return over time. With key leadership appointments recently completed, we're well positioned to execute with focus and discipline. We look forward to advancing our strategic priorities and providing clear updates on our progress in the quarters ahead. Overall, while we are being thoughtful in how we sequence and advance programs, we remain confident in the depth of the pipeline and the opportunities it presents. With those closing remarks, I'd like to thank everyone for listening, and I'll turn the call over to the operator to begin the question and answer session. Operator?

Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please do limit yourself to one question. Please stand by while we compile the Q&A roster. Our first call is from Eva Forti with Wells Fargo. Your line is open.

Hi, good afternoon. Congrats on the progress, and thanks for taking our questions. A couple from us. First, how should we be thinking about cadence of data for some of your internal pipeline programs in the next 12 months? And the second question is on the PAN-RAS ABCs. Can you provide some color and timing to reach the clinic and whether you plan to pursue the early clinical stages of development yourself? Thanks.

No, thanks for that question, Eva. I'll just maybe take the first one and then I'll pass the second one to for Paul to answer and then happy for Adam to add to Paul's comments as well. I think we've tried to provide as much guidance as we can on the cadence of data. Obviously, we presented some additional updates on ZW191 at AACR and also just had NAPSTEC accepted for ESMO-GAIN in June in Copenhagen. So I think we'll continue to have a cadence of, as we understand our data, then we'll be able to present that always in a peer-reviewed format, as I think we've talked about, because we think that's the best practice. And so I think you should expect that at oncology meetings throughout the course of 2026 that you will see some additional progress on both clinical and preclinical programs in our oncology portfolio. And until we provide guidance about accepted abstracts, just as we're doing now with ESMO-Gyne conference coming up next month, then that'll be the only forward guidance we'll will provide. And I'll turn over to Paul to see if he'd like to answer that second question.

Yeah, I think your second question, Eva, was on the timing of the RAS ADCs and when they could be in the clinic. I think what we shared at AACR is, you know, the strength of our conviction in the choice of the targets and choice of the payload and the mechanism. There are certain IND enabling activities that you still need to do, the manufacturing and be ready for the phase one. But we're well-positioned from here to enter into that phase. I think, you know, as Ken alluded to and maybe Adam can also expand upon, you know, our balance of what we can push internally through as well as through partnerships is something very much, you know, at the front of our mind. And so that will also be a factor in driving, you know, when they enter the clinic. But certainly they are well positioned where they are to enter into the IND enabling stage. and be ready, you know, shortly for clinical testing.

Very helpful. Thanks.

Thanks, Paul. Anything you want to add, Adam? Are you okay with that?

No, I think that's well said, right? We've got a lot of belief in these compounds. It's super exciting coming out of ACR, and, you know, we're moving them forward as quickly as we can.

So as soon as we have a real definitive date, we'll share with you guys. Great. Thank you.

Thank you for your question.

Our next question comes from Charles Zhu with LifeSci Capital. Your line is open.

Hello. Can you all hear me all right? Yes, Charles. All right, perfect. No technical difficulties this afternoon. Great. Thank you very much for taking our questions, and congrats on all the progress. Two quick ones from me, if you don't mind. One, so it sounds like you had amended the protocol for ZW51 to include additional tumor types. I guess as you head towards initial clinical data for that particular asset, how important or not would it be to include some of those other tumor types beyond the liver cancer as part of that initial clinical data package? And then second question, it sounds like the INV filing for 1528, your IL-33, IL-4 receptor alpha bispecific has been pushed out a little bit. It sounds like you're waiting to understand or see a little bit more about the IL-33 biology. Could you perhaps, I presume you're talking about the Astra compound. Could you help us understand, you know, what you're looking for in the full data and maybe also remind us on your acid, are you able to block both oxidized and reduced forms of IL-33? Thank you.

No, great, great. Question, Charles. Maybe we'll take your second one first. I'll just make a comment, then I'll pass it to Paul for more of a technical question, then we can go back to the 251 with Sabine. But I mean, obviously, we saw some data results last year with respect to all 33 antibodies and other programs that were not successful. And I think we tried to understand, as clinical data was presented at medical congresses, what that meant and why. And obviously, this year, as you mentioned, we've seen a top-line data release of a positive phase three study outcomes in all 33 in a patient population similar to what we would like to study. Haven't seen the detailed data yet presented in Medical Congress. I think we'd like the opportunity to understand that data when it's presented, and hopefully that's soon, and make sure we understand that and discuss that with our clinicians who are helping us with our planning around the clinical development program we have in mind for 15-28. So I think that hopefully it's a prudent thing to do to make sure we understand the differences between some of the negative studies and this what's seen as a positive study before we dive into the clinic. And maybe I'll turn that last tactical question over to Paul, and then Sabine can follow up on 251.

Yeah, thanks, Charles. Yeah, your question was about the blocking of IL-33, the oxidizing, the reduced form. And we've obviously been characterizing that, understand that, and we feel that we do have the the potential to block both pathways. We're still dissecting that more on the mechanism, but clearly we have a very potent IL-33 blocker and it works very well also in the context of the biospecific and there's biology also associated with having the IL-33 binder in a biospecific format with the IL-4 that we are very excited about and we think really differentiates our approach to others. But to your point, we feel that we can, on the IL-33 side, we will be able to block, you know, both forms.

Thank you very much for your question.

Oh, sorry.

I'm sorry.

Yes, to your question regarding CW251 of inclusion of additional tumor types for squamous non-small cell lung cancer and germ cell tumors. I think I can explain our rationale behind it. Previously, as we entered into the clinic with DW251, we chose hepatocellular carcinoma as our lead tumor type due to the high unmet need in this tumor type and also the high levels of expression for GPC3 in this tumor and very little expression in normal tissue. As we've gotten over time more comfortable with our ADCs and particularly with our folate receptor alpha ADC where we saw activity in lower levels of expression for the target, we became more comfortable in other tumor types as well. And also over time, there's very little data with regards to expression of GPC-3 in other tumor types. We've been able to go through the literature and also including our data for GPC-3 expression in squamous non-small cell lung cancer and germ cell tumors where we feel very comfortable in including these tumors in our study. It's fairly common for those escalation studies to include multiple solid tumors, which is what we're doing at this stage.

Got it.

Thank you very much for taking our questions, and congrats on everything. Thanks, Charles.

Thank you. Our next question is from John Miller with Evercore. Your line is open.

Hi, guys. Thanks so much for taking my question, and congrats on all the progress. I'd like to ask my question on the novel PanRAS ADCs. In particular, in the criteria you had for selecting the PanRAS payload that you ended up choosing, it looks like you looked at a number of different molecules here across a variety of different characteristics. It's notable that most other second-gen or next-wave PanRASes have prioritized high potency, and it doesn't seem like that was your priority next to other things. So I'd love to to get a little bit more granularity in what you were selecting for in the payload and why you didn't think that pushing potency as far as it could go was the key to success in the next-gen space.

Yeah, thanks, Paul. Do you want to take that?

Yep, yep. Thanks, John. Yeah, maybe I should clarify that there. You know, it may be that the messaging was that We've looked at payloads that work well as ADCs and emphasized their compatibility as ADCs, and that may have signaled that we weren't so focused on potency. We definitely had a potency bar that we wanted to achieve, and I think you can actually see it in the data that we share today. In the comparison with the same target with a topo ADC compared to our RAS ADC, we actually have greater potency. There was definitely a bar of potency that we wanted, and we wanted in the context of an ADC to meet a bar that we felt was necessary. But we also feel because it's a payload for an ADC, there's other attributes that need to be also factored in when we're looking at that. And that includes things like bystander activity that we think can also be important, and then also the pharmacokinetic properties, and then also just the balance of tolerability as well. And I think what we've done is we've really had a great place where we've got very good potency activity in xenograft models in the one meg per gig range, whereas the tolerability in non-human primates is 120 megs per gig. That's just really a very impressive window that we've found. So that taken together has given us a lot of excitement on this platform. And then the fact that we can then plug and play it and apply it to different targets really opens up scope across different tumor indications there, we can really drive the selectivity of the payload to the tumor through our mechanism, which is not what you can do with the small molecules.

Makes sense. Thanks so much. Maybe to follow up on that NHP comment that you made on the tolerability, can you translate those dose levels that you were talking about? I assume those are ADC dose levels. Can you translate that to the relative level of payload compared to some of the non-ADC-based PANRASes out there?

Yeah. Non-PANRAS. Sorry, say that again, John. Just ask me that question again. Sorry.

I think you're citing NHP safety data, talking about the full dose of the ADC you're giving, which makes sense. but we're used to looking at tox profiles for other panrases outside of the context of an ABC. Those are just naked molecules. Can you give us a sense of the relative amount of payload you're delivering pre-clinically? So I can think about that.

Yeah. I mean, maybe, I don't know if the DAR helps you, but these are all DAR-A antibodies or ADCs. So that can help you factor that in. And again, I think our focus, we're very much focused on showing the difference in the distribution and the tolerability profile of our ADC, that's what we've really been focused on. And so those experiments I showed you where we're comparing distribution in the tumor versus normal tissue, we think is the key here. And that, we think this allows us to go very high in dose and still maintain tolerability. So that's really been our focus as opposed to trying to compare against, you know, relative amount of moles or comparison to the small molecules themselves.

That makes perfect sense.

Yeah. Thank you so much.

Thanks, sir.

Thank you. Our next question is from Yagal Nakamovitz, my apologies, from Citigroup. Your line is open.

Yeah. Hi. Thanks. Congrats on all the progress. I just had two questions. Jazz had commented on their earnings call regarding some MFN pricing headwinds associated with the ex-US launch of Zahara. I'm just wondering if you could comment on that with respect to your royalty base for your ex-US royalty stream for Zahara and how that factored into your thinking about underwriting the $250 million note with royalty pharma. And then with regard to... the second interim for overall survival for Horizon GEA, which is coming in the middle of the year. I'm just wondering if that is going to be included in the label, or that would be a post-approval update, and if you could comment on, you know, what the threshold is for that second interim. Thank you.

Yeah, thanks to you all for the questions. I think, Juan, I don't think we want to comment further than Jazz's observation. about Zahira having maybe some more pricing pressure outside the U.S. than inside the U.S. I don't think that's unexpected for Zahira or any pharmaceutical in today's market. Obviously, the way we've modeled out Zahira and I think obviously the way that maybe Royalty Pharma has modeled out Zahira would have taken into account some of those pricing pressures that may be more significant outside the U.S. market than inside the U.S. market. I don't think that's something that's was unexpected. And again, we'll have to wait and see with the GA launch how that goes. Obviously, there's a tremendous clinical benefit that we've seen already with our second-line biliary tract cancer opportunity with Sahira when you look at the data. And you've obviously seen the clinical data for GAs. There's no doubt we're providing a tremendous clinical benefit for the patient based on our clinical data compared to the current standard of care. And I think that's reflected in in pricing reimbursement mechanism. Secondly, beyond that, other than the fact that, you know, Jazz continues to guide that the, you know, next-generation analysis will be mid-year, I don't think we're able to comment further on the regulatory strategy that might be related to that data set. Okay, thank you.

Yeah, sorry.

Thank you for your question.

Our next question comes from Mayanik Mamtani with B Reilly Securities. Your line is open.

Hi, this is Paolo for Mayanik, and thank you for taking our questions. Just to touch on the FR-alpha, like what's the specific durability or subpopulation edge that distinguishes it from the competitors enough to drive a deal? And on the RAS, Like, you know, to expand on the internal versus the partnership balance, can you speak specifically on the partnership funnel post-AACR? Has the data driven an incremental inbound interest? And if so, which one of the three molecules is leading those discussions? Thank you for taking your questions.

No, thanks. I'll cover the second part of your question first, and I'll ask Sabine to comment on maybe our thoughts around where we think ZB191 might be differentiated from some of the other ADCs in development and therefore the positioning of that. But I think it's fair to say we are open to and have active conversations around our R&D portfolio up and down the portfolio from the furthest clinical asset that's advanced like ZB191 right to some of the earliest opportunities that we might be working on inside inside the company. I think we're open to having those discussions and looking for ways that we can attract partners to share capital, share risk, move more quickly to keep up to competition, and also find a way to manage the breadth of the R&D pipeline that we find ourselves with right now, which is vast and continues to grow. And we need to make sure that we manage our ongoing investments in that R&D portfolio. I think we have a range of Discussions ongoing. I don't think we'll talk further or provide guidance about that until we have completed transactions and then happy then to talk about the transactions that have been completed and the rationale for it and what we think it brings to us and what we might do next beyond that. So you'll just have to wait for announcements of transactions around that. And I'll just ask Sabine to answer the second part of your question about ZW191.

In terms of ZW191 being differentiated from other ADCs, we can clearly see that ZW191 activity is much higher than current standard of care in this therapeutic area in in platinum-resistant ovarian cancer. We also see that for approved folate receptor alpha-ADC thrombotuximab, we're clearly showing a much stronger response rate as well as a very well-differentiated and improved safety profile. Comparing to other emerging ADCs that are in development, even there, we are showing numerically, we're showing the strongest response rate. And we haven't really seen many others show longer duration like we have from their phase one trials. We are dosing our ADC at the higher dose levels that we talked about earlier in my presentation compared to many of the other ADCs in this space. And we believe that these higher dose levels were still, in terms of the safety profile, we still have a very manageable safety profile at higher level of dose that we're delivering to our patients that would ultimately translate into better efficacy at these higher dose levels and larger populations. And that we think would be what's going to be able to differentiate us from our competitors. From a safety profile perspective, we don't have some of the liabilities that some of our competitors have. Our cytopenia rate is pretty low. We do not use prophylactic growth factors. And our drug is pretty well tolerable.

Thank you. Thank you for the questions.

Thank you very much. One moment, please.

Our next question is from Rennie Benjamin with Citizens. Your line is open.

Hey, good afternoon, guys. Thanks for taking the questions, and congratulations on all the progress. Great AACR for you guys. Maybe just starting off the first one for Sabine, the ESMA Guide Conference that's coming up, can you give us a sense as to, you know, what we should be expecting? Is it just further follow-up from the existing patients, or might we see, some updated or initial data from the cohorts that have been fully enrolled. And just related to that, in the data you presented at ACR, I probably missed this, but can you just talk us through the rates of discontinuation and dose reduction that occurred? And I'm just trying to look at these data through a lens of maybe Project Optimist. And the second question would be for Paul. Can you walk us through the decision-making process when you determine whether to make a bi-paratopic antibody versus not? You know, especially the pan-RAS payloads, you have, you know, one that does and two that don't, and I'm kind of curious as to how you guys make that decision. Thanks.

Okay, no, thanks, Ryan. We'll stop you there, too. So maybe, Sabine, do you want to answer Ray's questions first, then we'll go to Paul?

Yes, so I can talk over, so I think one of your questions was with regards to folic receptor alpha ADC presentation at Esmogon. So, we will be presenting data with regards to folic receptor alpha expression level from our phase one dose escalation study. Our data from dose optimization is going to be presented sometime later when the data is matured. We just finished enrollment of that cohort. So, with regards to the data that we did present at AACR for our dose reductions and discontinuations, I mean, I can say that those reductions are fairly very common with ADCs. And our dose reduction rate was very much expected given the long-term follow-up that we've had. Most of these reductions occurred much later in time while patients were on treatment, These represent, so I would say that despite these, we still see a pretty strong efficacy profile, which plays into the fact that many of these patients did get pretty high dose intensity in terms of treatment as we went through their dose levels. In terms of discontinuations, again, this has happened much longer follow-up, because our median follow-up was over seven months, and many of our patients were in follow-up for much longer than that.

Thanks, Sabine. Paul, do you want to take the second part of the question?

Yeah, sure. Yeah, and this is an easier answer for me to answer, or an easier question. So, yeah, what we do when we decide what the antibody vehicle is for the payload is we we basically screen empirically for what gives us the best delivery and activity with the payload, the best internalization, the best tumor penetration. So if you look at our papers, we show that. And then what we test there is if we have an antibody that we can find, a monoclonal antibody that can achieve the optimal level, we go with the antibody. We will test also bipyrotopic. So, for instance, for 191, when we tested 191, we actually found an antibody that's way better than any other polar receptor antibody that we had at that time and since then has also, you know, looks better when we look at other competitor antibodies. Making a bipyrotopic there didn't give us anything. In the case of something like PTK7, there what we found was that you can get good internalization with, you know, bisects looking for antibodies, but based on the structure and the design of or the structure of PTK7 is amenable to bipyrotopic binding. It has enough kind of binding sites to give you a meaningful bipyrotopic. And when we looked at those, we found that those could give us activity way beyond what you could achieve with just a monoclonal antibody. So that's what drove it there. So we're always striving to get the best delivery vehicle, the one that gives us the best penetration. And another important point that we also bear in mind is actually the pharmacokinetics of those types of molecules. We must make sure we maintain that. And that's something that we also factor into our design of our bi-part topics. So hopefully that gives you an answer for your question.

Yeah, it totally does. And just, you know, very quickly as a follow-up, you know, you saw a lot of other companies, the competition increasing, especially in PTK7 and the like. When you guys are doing your preclinical evaluations, are you also comparing it to other products that are in development, if you can, you know, get the structure, or how do you do your best comparisons?

Yeah, we do that, actually, and it's actually in that PTK7 poster. You know, there was an original antibody, cofetuzumab, that was generated that had been in the clinic before. We compared against that, but subsequently, we know the other PTK7 antibodies, so we can make those antibodies and then compare them, you know, for their properties. And if you look back at that poster, you'll see that Bipyrotopic also out-competes those as well.

Excellent. Thanks for taking the questions.

Thanks, Ryan. Thank you.

Our next question is from Steven Wiley with Stifles. Your line is open.

Yeah, good afternoon. Thanks for taking the question. Just curious how you're thinking about the scope of incremental development that you're willing to independently pursue with 191 here. Do you want to generate more data in other tumor types besides ovarian? Do you want to initiate combo trials? I'm just trying to think about the differentiation you've been able to establish to date and then just how you're thinking about the ROI that's associated with additional work on this. Thanks.

Yeah, thanks, Steve. I think it's no different than all the programs we have. I think we try to be very thoughtful about staging investments along the way just to make sure we can understand, you know, strategic and competitive positioning of that asset, how that might change, and how an individual data set might convince us to make additional investment for moving forward. You know, it's very clear with EW191, you know, we you know, we're quite encouraged by our dose escalation, uh, data. Initially we, we funded, you know, some additional investment in backfill patients to get to the data set. We present ACR. We think it's very compelling data set. We move very quickly to invest in, you know, a dose optimization cohorts of, you know, 30 each as opposed to, you know, 20 each of those might have done because we think that'll give us a, you know, additional data point. That's, that's interesting. And, you know, we'll let that, um, data mature, uh, and, and go from there. At the same time, we've been very clear that, you know, it's a very competitive, um, positioning right now in gynecological tumors, both ovarian and different settings and even, even endometrial. And so, um, with so many competitors ahead of us, um, it's hard to see how without a partner, we could move quickly to take advantage of the properties that we see in ZW191. So at some point that is going to have to be something that we secure to continue to move forward. And so I think we'll continue to present the dose escalation data next month. We'll let the dose optimization cohort mature, and then we'll have to make a decision then about the extent of how that encourages us to make additional investments versus focusing on a partnering transaction that might allow a partner to to take on the further investment to push that forward. So we'll do that. And we do that the same way with every program that we have.

All right. Thanks for taking the question.

No, thanks, Steve. Appreciate it.

Thank you. Our next question is from Yaron Werber with TD Collins. Your line is open.

Great. Thanks so much. I guess my first question is, as you kind of think about developing the next program you know, a target, how do you determine between an oncology target or an inflammation target, just given the flexibility of the platform? Um, And then secondly, the RAS inhibitor itself, can you maybe give us a little bit more information about was that developed sort of the chemistry completely in-house? Is that something that was using, you know, kind of a scaffold that's known that you then kind of varied? Where did that agent come from? Thank you.

Yeah, thanks, Sharon. Maybe I'll take your first question. I'll leave the second one for... Paul, but, you know, I think historically in Zymmerx, all of our initial work starting from Xanadamab were in solid tumor indications. I think when we decided then to also add ADCs to our modific antibodies, we focused on solid tumor. I think, you know, since then, we've been a little more open to looking at targets that might have some interest in Hemonc. as well as in autoimmune and inflammatory. And that's why we started working more closely in that area. So I think we do like the additional breadth of opportunity that's provided by having something that goes beyond solid tumors to look for opportunities. But I think for the most part, we're kind of indifferent as to the therapeutic area, as opposed to looking for something that's a real need that we think our technology approach can provide a potential for a superior outcome. patient benefit. And so we'll just allow the opportunities that we might have in front of us in our platform to be applied, take it into those therapeutic areas. We don't really predetermine targets in specific areas or quotas or allocations of where we want to spend our time. We're just open to looking at a broader context than maybe we did earlier in Zymerc's history. But we'll just go where the opportunities, where we find them. And I'll let Paul answer the second question. by the medicinal chemistry for the RAS payload. Yeah.

Yeah. Thanks, Ken. Yeah. So what we did there was we, to get the proof of concept, we actually did use the RevMed pan RAS inhibitor. And that gave us indication that we could, you know, an ADC could work for this type of payload. But what we then did after that was we then generated a whole panel in-house of novel payloads. Really more focusing on those payloads for their chemistry properties and their structural properties that, again, were compatible with ADC. So these are novel structures that we had generated by tweaking certain chains and working off of a structure, but making modifications there that were compatible with ADC and all the properties I just talked about. So these would be considered novel payloads.

Thank you for your question.

Our next question is from Brian Chang with JP Morgan. Your line is open.

Hey, guys. Thanks for taking our question this afternoon. I'm just curious if you could give us directionally how we should think about your development path or your development strategy for your PAN-RAS ADC approaches here. You know, you have different targets attached to a PAN-RAS. how should we think about the positioning here? And, you know, whether it makes the most sense to go after PDAC first or lung or colorectal, you know, do you have a sense of which is the best target, which one has the best probability of success based on where you are today? Thank you.

No, thanks for the question, Brian. I'll let Paul answer that question. Other than the observation that, you know, I just thought ACR, we, We don't like to do things one at a time. I think as you saw with our topo payload ADCs, we just believe trying to apply the technology to multiple opportunities at the same time. And that's why you saw three disclosed at ACR. And I think it gives us some optionality of the ordering and how to pursue prioritization, make sure we pay attention to competitive advantage of what we might be doing versus what others might be. But I'll just let Paul maybe describe a little bit more about that. our approach and why those three and why those indications were selected and what they bring. And each of those targets brings something different.

Yeah, I know. Thank you, Ken. Yeah, that's right. The thinking there, Brian, is we wanted to have ADCs that are really, you know, designed with the tumor in mind. So this is a big, one of our sort of differentiating factors here is that we can target to the tumor. And by having antibodies that can give us coverage across the different tumor types that are mutated by RAS, it just gives us the whole sort of universe of RAS tumors that we can go after. But each one of them will have strength for particular tumor types, as you allude to. But that puts us now in a position where we can think through development strategies and not be restricted by just having one ADC against a particular target. So regarding where we think we will go, I think that I'm not in a position to discuss that now. In detail, that's definitely something that we have a lot of optionality, that the molecules provide a lot of optionality. And again, it could provide optionality through certain partnerships or programs that we take through ourselves. So that's about as best I can answer that. But what I can say is that, you know, the design of those, again, the features of those molecules, we thought very much about the antibody and the targets. because the coverage it can give you within the RAS space. And some of our publications presented showed that. So for instance, the reason we picked PTK7 for lung cancer is that the penetrance of PTK7 expression in lung cancer supports, but also in the RAS mutated lung cancer, we see very high penetrance of that tumor marker. So we think we're well positioned.

Okay, that's very helpful, Paul. Thank you.

Thank you, Brian.

This does conclude our question and answer session. I would now like to turn it back to Ken for closing remarks.

Yeah, thank you very much. So thank you everyone for joining us. I know it's been a very busy earnings season this week in particular, so really appreciate you taking the time to listen to our progress. And we very much look forward to reporting progress over the weeks and months ahead.

So thank you very much.

Thank you for your participation in today's conference. This does conclude our program. You may now disconnect.