After failure, Zynerba shifts gears to save cash
- Zynerba Pharmaceuticals on Thursday announced negative topline results from a Phase 1 safety and dosing study of its transdermal tetrahydrocannabinol patch ZYN001, sending shares down as much as 15% in early morning trading.
- The results showed the patch was unable to achieve target blood levels of 5 to 15 ng/ml of tetrahydrocannabinol. There were no serious adverse events or discontinuations during the study.
- Based on the findings, Zynerba has chosen to shift its focus to ZYN002, which is being developed in Fragile X syndrome, developmental and epileptic encephalopathy and adult refractory epilepsy.
Zynerba made the decision to shift resources away from ZYN001 to conserve cash. The company now has cash and equivalents of about $52 million, and expects this will sustain operations through the second half of 2019.
Had ZYN001 delivered, the drug was expected to start a Phase 2 study in Tourette's syndrome. Those plans have now been scrapped.
"The miss raises some question marks about efficacy of the transdermal delivery system and leaves ZYN002 as the company's sole clinical asset, which has always accounted for our entire valuation," wrote Jefferies analyst Biren Amin in a Thursday note to clients.
The company will now try to carry ZYN002 over the finish line. But with limited resources and a number of failures in the drug's past, it will be a difficult task. Last summer, the company announced the drug failed in a mid-stage study for patients with adult epilepsy and focal seizures.
ZYN002, a synthetic transdermal cannabidiol gel, also failed to demonstrate a statistically significant reduction in knee pain for osteoarthritis patients last summer.
The movement comes after competitor GW Pharmaceuticals late last month won Food and Drug Administration approval for its cannabis-based epilepsy treatment Epidiolex (cannabidiol). While this marked the approval of the first plant-derived cannabis-based drug, the FDA was quick to point out that the data supporting approval of Epidiolex was unique and does not support the approval of any other cannabinoids.
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