Zymeworks (NASDAQ:ZYME) executives used the company’s fourth-quarter 2025 results call to highlight updated clinical data for its partnered HER2 antibody zanidatamab, outline a new royalty-backed financing with Royalty Pharma, and provide 2025 financial results and pipeline updates across multiple early-stage programs.
Partnered zanidatamab program: Phase 3 results and regulatory path
Chair, CEO, and interim CFO Ken Galbraith opened by pointing to results from the Phase 3 HERIZON-GEA-01 trial presented at ASCO GI by partners Jazz Pharmaceuticals and BeiGene. In first-line metastatic or locally advanced HER2-positive gastroesophageal adenocarcinoma (GEA), zanidatamab in combination with chemotherapy, with or without a checkpoint inhibitor, demonstrated a median progression-free survival exceeding one year and median overall survival exceeding two years, which Galbraith described as a clinically meaningful outcome in a setting with historically limited long-term survival.
On the regulatory front, Galbraith said Jazz expects to complete submission of a supplemental biologics license application (sBLA) to the FDA in the first quarter of 2026 under the Real-Time Oncology Review program. Zanidatamab has Breakthrough Therapy designation for HER2-positive GEA, he noted, and the HERIZON-GEA-01 data have been submitted for inclusion in NCCN guidelines. Galbraith said Zymeworks shares Jazz’s expectation for U.S. approval and launch for GEA in the second half of the year, subject to FDA review and approval. He also noted BeiGene is working toward a supplemental BLA for tislelizumab in the U.S. in the first half of 2026.
Milestones, royalties, and recent approvals for Ziihera
The company also reported regulatory approvals during the quarter for zanidatamab monotherapy in Canada and the United Kingdom for second-line biliary tract cancer. Galbraith framed the broader zanidatamab program as a foundation for future milestone and royalty streams. He said Zymeworks expects the program could translate into regulatory milestone payments for global approvals in GEA of up to $440 million, plus an additional $89 million collectively from Jazz and BeiGene upon approval in a third indication beyond biliary tract cancer and GEA. The company is also eligible for up to $977.5 million in commercial milestone payments tied to sales thresholds, with Galbraith stating that approximately $1.5 billion in milestone payments remain possible under the Jazz and BeiGene collaboration agreements.
Galbraith disclosed royalty economics under the partnerships:
- Jazz collaboration: tiered royalties of 10% to the high teens on global annual sales up to $2 billion and 20% on annual net sales above $2 billion; Jazz holds global marketing rights excluding Asia (and including Japan).
- BeiGene collaboration: tiered royalties of mid-single to mid-double digits on global annual net sales up to $1 billion and 19.5% above $1 billion; BeiGene holds marketing rights in Asia excluding Japan.
Galbraith also noted Jazz’s updated enrollment guidance for the EmpowHER303 breast cancer trial, with completion of enrollment expected in the first half of 2027 and top-line data expected later in 2027 or early 2028. He added that Jazz has initiated a Phase 1 combination trial of zanidatamab with Boehringer Ingelheim’s zongertinib in metastatic HER2-positive breast cancer, with potential evaluation in other tumor types.
Royalty Pharma financing: $250 million non-recourse royalty-backed note
Galbraith said Zymeworks entered an agreement with Royalty Pharma for $250 million of “low-cost non-dilutive capital” in the form of a non-recourse royalty-backed note. He emphasized that the transaction is “not a monetization,” stating that full value of Ziihera royalties returns to Zymeworks after repayment. The company described the structure as having no stated interest rate and using only 30% of the Ziihera royalty stream (rather than 100% in a traditional royalty loan) to service repayment, while Zymeworks retains 70% of royalties during the term. Galbraith said milestones under the Jazz and BeiGene agreements are retained by Zymeworks and are not used for repayment.
Management tied the financing to a broader capital allocation framework centered on continued share repurchases and potential acquisitions of royalty-bearing assets or platforms. Galbraith said the company’s runway already extends beyond 2028, and the financing adds flexibility without equity dilution.
2025 financial results and operating framework
Senior Vice President of Finance Bijal Desai reported total revenue of $106 million for 2025, up from $76.3 million in 2024. She said the increase was driven mainly by achievement of clinical and regulatory milestones and exercise of an option under collaborations with Johnson & Johnson, Boehringer Ingelheim, GSK, Daiichi Sankyo, and BMS, partially offset by lower development support and drug supply-related revenue from Jazz as responsibilities transitioned under the zanidatamab collaboration.
Operating expenses were $198.5 million for 2025, down from $213.4 million in 2024. Desai said the decrease was primarily due to a non-recurring impairment charge recognized in 2024 related to the discontinued zanidatamab zovodotin program, partially offset by a slight increase in R&D expense. Net loss for 2025 was $81.1 million versus $122.7 million in 2024, driven by higher revenue and lower operating expenses, partially offset by lower interest income.
As of December 31, 2025, Zymeworks had $270.6 million in cash resources (cash equivalents and marketable securities), down from $324.2 million at the end of 2024. Desai said that, based on current operating plans and assuming full execution of the $125 million share repurchase plan, existing cash resources combined with anticipated $440 million in regulatory milestone payments tied to potential GEA approvals (U.S., Europe, Japan, and China) and net proceeds from the royalty-backed note are expected to fund planned operations beyond 2028. She said the runway estimate excludes future milestones or royalties beyond those items, as well as contributions from future partnerships.
Desai also reiterated an adjusted (non-GAAP) gross operating expense framework announced in January 2026 of approximately $300 million over the three-year period ending December 31, 2028, and said the company expects adjusted gross operating expenses in 2026 to be about 20% lower than in 2025, excluding acquisition-related expenses or new partnerships.
Pipeline updates: ZW251, ZW191, and 2026 IND plans
Chief Medical Officer Dr. Sabeen Mekan said the Phase 1 study of ZW251, a glypican-3 (GPC3) antibody-drug conjugate (ADC) in GPC3-expressing tumors including hepatocellular carcinoma, is progressing as planned and actively enrolling. The study is expected to enroll about 100 patients across dose escalation and optimization, with sites open in North America, Europe, and Asia Pacific. She said a trial-in-progress poster was presented at ASCO GI in January, including a starting dose of 3.2 mg/kg in dose escalation. Mekan said the starting dose was informed by prior experience with ZW191, which uses the same linker and a drug-to-antibody ratio of 8, where early signs of activity emerged at 3.2 mg/kg after beginning at 1.6 mg/kg. ZW251 uses a lower drug-to-antibody ratio of 4, supporting initiation at 3.2 mg/kg, she added.
In Q&A, management said ZW251 enrollment is proceeding “very nicely” and that the company plans to present data in a peer-reviewed setting when it has a sufficiently complete dataset. Mekan also said ZW251 is enrolling across all levels of GPC3 expression, noting literature suggesting more than 90% of HCC patients have some expression; the study will evaluate expression levels and correlate with efficacy once enough data are available. She also said other tumor types with GPC3 expression may be evaluated over time, including rare germ cell tumors, certain lung cancers, pediatric tumors, and sarcomas.
Galbraith reiterated that IND submissions for wholly owned multispecific programs ZW209 and ZW1528 remain on track for 2026. In discussion of ZW1528, management said an ex-U.S. regulatory submission could allow faster early clinical study execution, citing respiratory expertise in Europe and the company’s prior experience using an international footprint in early trials. On ZW209, Chief Scientific Officer Paul Moore described it as a trispecific molecule targeting DLL3, CD3, and CD28, designed to incorporate co-stimulation in a single agent, with the goal of driving deeper and more sustained T-cell activity.
Galbraith also referenced continued partner progress for pasritamig, stating it has shown an encouraging safety and efficacy profile in a Phase 1 combination regimen, including with docetaxel, as presented at ASCO GU.
About Zymeworks (NASDAQ:ZYME)
Zymeworks Inc is a clinical-stage biopharmaceutical company dedicated to the discovery, development and commercialization of next-generation multifunctional biotherapeutics. The company specializes in engineered antibody and protein therapeutics designed to address a range of unmet medical needs in oncology and other serious diseases. Through its proprietary platforms, Zymeworks aims to create novel bispecific and multispecific molecules that can simultaneously engage multiple targets and recruit immune effector functions to enhance potency and specificity.
At the core of Zymeworks’ innovation is its Azymetric™ bispecific antibody platform, which enables the design of asymmetrical bispecific antibodies with controlled assembly and high stability.
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