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Agreement reached with U.S. FDA on in vivo animal study design and protocol to translate work from novel in vitro assays and establish relevant safety margins
Topline data from the in vivo study expected by the end of 2019
PATH for PWS study over-enrolled with continued strong support from Prader-Willi syndrome (PWS) community
BOSTON, Aug. 08, 2019 (GLOBE NEWSWIRE) -- Zafgen, Inc. (Nasdaq:ZFGN), a clinical-stage biopharmaceutical company leveraging its proprietary knowledge of MetAP2 systems biology to develop novel therapies for patients affected by a range of metabolic diseases, today reported its second quarter 2019 operating and financial results.
“Since the beginning of 2019, we have remained focused on gaining clarity on the path forward for ZGN-1061. With the recent alignment with the FDA on the design of an in vivo animal study, we are now preparing for the rapid initiation and strong execution of this study,” said Jeffrey Hatfield, Chief Executive Officer. “We expect to provide topline data by the end of 2019, which will be the driving factor that informs our future plans. In addition, we have strong financial resources, which we expect to last greater than two years, given our current operating plan.”
Second Quarter 2019 Financial Results
Cash, Cash Equivalents and Marketable Securities
As of June 30, 2019, the Company had cash, cash equivalents, and marketable securities totaling $91.7 million. Based on recently implemented plans to reduce its operating expenses and prioritize key resources, Zafgen expects its projected cash runway to last greater than two years, given its current operating plan.
The Company reported a net loss for the second quarter of 2019 of $12.1 million, or $0.32 per share, compared to a net loss of $15.8 million, or $0.57 per share, for the second quarter of 2018.
The weighted average common shares (basic and diluted) outstanding used to compute net loss per share were 37.3 million for the second quarter of 2019 compared to 27.6 million for the same quarter of 2018.
Research and Development Expenses
Research and development expenses for the second quarter of 2019 were $8.6 million compared to $12.2 million for the second quarter of 2018. The decrease in research and development expenses compared to the prior year period was primarily due to completion of the second cohort of the Phase 2 clinical trial in type 2 diabetes for ZGN-1061, decreased spending and non-cash stock-based compensation expense related to our other clinical and nonclinical programs and activities, partially offset by an increase in costs related to ZGN-1345 as the program advances as a development stage candidate.
General and Administrative Expenses
General and administrative expenses for the second quarter of 2019 were $3.6 million, compared to $3.4 million for the second quarter of 2018. The increase in general and administrative expenses as compared to the prior year period was primarily due to an increase in personnel related costs and non-cash stock-based compensation expense.
Zafgen (Nasdaq:ZFGN) is a clinical-stage biopharmaceutical company leveraging its proprietary MetAP2 biology platform to develop novel therapies for patients affected by complex metabolic diseases. Zafgen has pioneered the study of MetAP2 inhibitors in both common and rare metabolic disorders. Learn more at www.zafgen.com.
Safe Harbor Statement
Various statements in this release concerning Zafgen's future expectations, plans and prospects, including without limitation, Zafgen's expectations regarding the development and use of ZGN-1061, ZGN-1258, ZGN-1345 and other second-generation MetAP2 inhibitors as treatments for metabolic diseases including Prader-Willi syndrome, type 2 diabetes, liver diseases and obesity, the collection of medical history and medical events from PATH for PWS participants to inform development for potential treatments for Prader-Willi syndrome and Zafgen's expectations with respect to the timing and success of its ability to collect and analyze PATH for PWS data for development and clinical trial design and with respect to its nonclinical studies and clinical trials of ZGN-1061, ZGN-1258, ZGN-1345 and its other product candidates, Zafgen’s expected cash, cash equivalents and marketable securities balance as of June 30, 2019, and Zafgen’s expectations regarding the length of its cash runway, may constitute forward-looking statements for the purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995 and other federal securities laws. Forward-looking statements can be identified by terminology such as "anticipate," "believe," "could," "could increase the likelihood," "estimate," "expect," "intend," "is planned," "may," "should," "will," "will enable," "would be expected," "look forward," "may provide," "would" or similar terms, variations of such terms or the negative of those terms. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including, without limitation, Zafgen's ability to successfully demonstrate the efficacy and safety of ZGN-1061, ZGN-1258, ZGN-1345 and its other product candidates and to differentiate them from first generation MetAP2 inhibitors, such as beloranib, the nonclinical and clinical results for ZGN-1061, ZGN-1258, ZGN-1345 and its other product candidates, which may not support further development and marketing approval, actions of regulatory agencies, which may affect the initiation, timing and progress of nonclinical studies and clinical trials of its product candidates, Zafgen's ability to execute the in vivo animal study designed in alignment with the FDA, establish acceptable safety margins on ZGN-1061 based on the results of such study and resolve the clinical hold on ZGN-1061 based on the results of such study, Zafgen’s ability to overcome the full clinical hold place on ZGN-1061 by the FDA and obtain regulatory approval, Zafgen’s ability to continue to evaluate ZGN-1258 and to advance the program in nonclinical and clinical development, Zafgen's ability to obtain, maintain and protect its intellectual property, Zafgen's ability to enforce its patents against infringers and defend its patent portfolio against challenges from third parties, competition from others developing products for similar uses, Zafgen’s ability to manage operating expenses, Zafgen's ability to obtain additional funding to support its business activities and establish and maintain strategic business alliances and new business initiatives when needed, Zafgen’s ability to attract and retain personnel, Zafgen's dependence on third parties for development, manufacture, marketing, sales and distribution of product candidates, and unexpected expenditures, as well as those risks more fully discussed in the section entitled "Risk Factors" in Zafgen's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, as well as discussions of potential risks, uncertainties, and other important factors in Zafgen's subsequent filings with the Securities and Exchange Commission, including without limitation Zafgen’s Quarterly Reports on Form 10-Q. In addition, any forward-looking statements represent Zafgen's views only as of today and should not be relied upon as representing its views as of any subsequent date. Zafgen explicitly disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
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|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
|(In thousands, except share and per share data)|
|Three Months Ended June 30,||Six Months Ended June 30,|
|Research and development||8,572||12,209||18,203||24,642|
|General and administrative||3,618||3,351||7,264||6,620|
|Total operating expenses||12,190||15,560||25,467||31,262|
|Loss from operations||(12,190||)||(15,560||)||(25,467||)||(31,262||)|
|Other income (expense):|
|Foreign currency transaction (losses) gains, net||(22||)||(73||)||1||(136||)|
|Total other income (expense), net||61||(215||)||226||(469||)|
|Net loss per share, basic and diluted||$||(0.32||)||$||(0.57||)||$||(0.68||)||$||(1.15||)|
|Weighted average common shares outstanding, basic and diluted||37,326,853||27,565,064||37,320,436||27,553,394|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|(In thousands, except share and per share data)|
|June 30,||December 31,|
|Cash and cash equivalents||$||37,240||$||49,331|
|Tax incentive receivable||1,532||1,536|
|Prepaid expenses and other current assets||811||1,728|
|Total current assets||94,001||121,330|
|Property and equipment, net||968||375|
|Operating lease right-of-use assets||7,342||-|
|Tax incentive receivable, net of current portion||214||-|
|Liabilities and Stockholders' Equity|
|Operating lease liabilities, current||618||-|
|Notes payable, current||7,273||5,455|
|Total current liabilities||13,463||13,306|
|Notes payable, long-term||11,853||15,185|
|Operating lease liabilities||6,429||-|
|Preferred stock; $0.001 par value per share; 5,000,000 shares authorized as
of June 30, 2019 and December 31, 2018; no shares issued and outstanding as of
June 30, 2019 and December 31, 2018
|Common stock, $0.001 par value per share; 115,000,000 shares authorized as
of June 30, 2019 and December 31, 2018; 37,326,895 and 37,287,221 shares issued
and outstanding as of June 30, 2019 and December 31, 2018, respectively
|Additional paid-in capital||448,258||444,212|
|Accumulated other comprehensive income (loss)||30||(33||)|
|Total stockholders' equity||72,139||93,271|
|Total liabilities and stockholders' equity||$||103,884||$||121,762|