Get the Latest Investment Ideas Delivered Straight to Your Inbox. Subscribe


Biopharma Receives FDA Fast Track Designation for Cancer Therapeutic
Research Report

Share on Stocktwits


An explanation of the categorization and its implications are provided in a Paradigm Capital report.

In a May 30 research note, Paradigm Capital analyst Rahul Sarugaser reported that Zymeworks Inc.'s (ZYME:NYSE; ZYME:TSX) lead product candidate ZW25 was just granted fast track status by the U.S. Food and Drug Administration (FDA) for firstline treatment in combination with standard of care chemotherapy of patients with gastroesophageal adenocarcinoma. ZW25, a next-generation antibody targeting HER2-expressing tumors, is currently in Phase 2 of clinical development.

"The FDA fast track designation is an additional, emphatic bid of confidence in Zymeworks' technology and in its capacity to execute its very own world-class, clinical development programs," Sarugaser added.

He pointed out the designation's advantages. The categorization could speed up the regulatory approval process of ZW25 by an estimated six to 12 months, Sarugaser indicated, and improve the drug's chances of approval based on its inherent incentives.

Among those, it allows Zymeworks to use surrogate rather than direct endpoints, which offer a shorter data readout period. It affords automatic eligibility for priority review, meaning the company's application goes to the front of the line for review when submitted. The designation leads to more frequent interactions with the FDA for clinical design advice and application submission guidance. It also allows a rolling review process, so that pieces of the application may be submitted when ready rather than simultaneously after all are completed.

Sarugaser reported that in other noteworthy news, Zymeworks earned a $2 million milestone payment from Merck because Merck just finished late-stage preclinical studies. "We see it as a very positive signal that Merck, an $80 billion global pharma, understands the power of Zymeworks' technology to build clinical candidates," the analyst commented.

Paradigm Capital has a Buy recommendation and a $30 per share price target on Zymeworks, whose stock is currently trading at around $18.90 per share. "The company is a drug discovery engine, and it is coming increasingly clear Zymeworks is a clinical development machine," added Sarugaser.


1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures from Paradigm Capital, Zymeworks Inc., Research Note, May 30, 2019

The analyst (and associate) certify that the views expressed in this report accurately reflect their personal views about the subject securities or issuers. No part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendations expressed in this research report.

Analysts are compensated through a combined base salary and bonus payout system. The bonus payout is determined by revenues generated directly or indirectly from various departments including Investment Banking, based on a system that includes the following criteria: reports generated, timeliness, performance of recommendations, knowledge of industry, quality of research and investment guidance and client feedback. Analysts are not directly compensated for specific Investment Banking transactions.

Zymeworks Inc.:
Paradigm Capital Inc. has assumed an underwriting liability for, and/or provided financial advice for consideration to the subject companies during the past 12 months.

Paradigm Capital Inc. expects to receive or intends to seek compensation for investment banking services from the subject companies in the next 3 months.

Want to read more about Biotechnology / Pharmaceuticals investment ideas?
Get Our Streetwise Reports Newsletter Free and be the first to know!

A valid email address is required to subscribe