Zentalis Pharmaceuticals Inc

Previous wording

We are a clinical-stage biopharmaceutical company focused on discovering and developing small molecule therapeutics targeting fundamental biological pathways of cancers. Our lead product candidate, azenosertib (ZN-c3), is a potentially first-in-class and best-in-class WEE1 inhibitor for advanced solid tumors and hematological malignancies. Azenosertib is being evaluated as a monotherapy and in combination across multiple ongoing clinical trials. In clinical trials, azenosertib has been well tolerated and has demonstrated anti-tumor activity as a single agent across multiple tumor types and in combination with several chemotherapy backbones. As part of our azenosertib clinical development program, we are exploring enrichment strategies targeting tumors with high levels of replication stress, such as Cyclin E1 positive tumors, homologous recombination deficient tumors, and tumors with oncogenic driver mutations. We are also developing a BCL-2 inhibitor, ZN-d5, in combination with azenosertib, and we believe we are the only company that has both a WEE1 inhibitor and a BCL-2 inhibitor in clinical development. We currently exclusively in-license or solely own worldwide development and commercialization rights to azenosertib and ZN-d5.

Current wording

We are a clinical-stage biopharmaceutical company focused on discovering and developing small molecule therapeutics targeting fundamental biological pathways of cancers. Our lead product candidate, azenosertib (ZN-c3), is a potentially first-in-class and best-in-class WEE1 inhibitor for advanced solid tumors and hematological malignancies. Azenosertib is being evaluated as a monotherapy and in combination across multiple ongoing clinical trials. In clinical trials, azenosertib has been well tolerated and has demonstrated anti-tumor activity as a single agent across multiple tumor types and in combination with several chemotherapy backbones. As part of our azenosertib clinical development program, we are exploring enrichment strategies targeting tumors with high levels of replication stress, such as Cyclin E1 positive tumors, homologous recombination deficient tumors, and tumors with oncogenic driver mutations. We currently exclusively in-license or solely own worldwide development and commercialization rights to azenosertib.

Previous wording

Azenosertib is a potentially best-in-class and first-in-class oral, small molecule WEE1 inhibitor. The inhibition of WEE1, a DNA damage response kinase, drives cancer cells into mitosis without being able to repair damaged DNA, resulting in cell death and thereby preventing tumor growth and potentially causing tumor regression. Currently, there are no WEE1 inhibitors approved by the U.S. Food and Drug Administration, or FDA. We have designed azenosertib to have advantages over other investigational therapies targeting WEE1, including superior selectivity and pharmacokinetic, or PK, properties. Azenosertib is currently being evaluated in the clinic for advanced solid tumors and hematological malignancies as a monotherapy, in combination with traditional chemotherapy and other DNA damaging agents, and in combination with molecularly targeted agents. We are targeting the submission of our first NDA for azenosertib in a gynecologic malignancy in 2026.

Current wording

Azenosertib is a potentially best-in-class and first-in-class oral, small molecule WEE1 inhibitor. The inhibition of WEE1, a DNA damage response kinase, drives cancer cells into mitosis without being able to repair damaged DNA, resulting in cell death and thereby preventing tumor growth and potentially causing tumor regression. Currently, there are no WEE1 inhibitors approved by the FDA. We have designed azenosertib to have advantages over other investigational therapies targeting WEE1, including superior selectivity and pharmacokinetic, or PK, properties. Azenosertib is currently being evaluated in the clinic for advanced solid tumors and hematological malignancies as a monotherapy, in combination with traditional chemotherapy and other DNA damaging agents, and in combination with molecularly targeted agents. On June 18, 2024, we disclosed that the FDA placed our ZN-c3-001, TETON (ZN-c3-004) and DENALI (ZN-c3-005) trials on partial clinical hold following two deaths in the DENALI trial due to presumed sepsis. We have been working closely with the FDA to resolve the partial clinical hold as quickly as possible. In the course of our dialogue with the FDA, the FDA also placed ZN-c3-002 on partial clinical hold. ZN-c3-002, which currently has four patients on active treatment, is under the same IND as ZN-c3-001, TETON and DENALI. Patients currently enrolled in the studies on partial clinical hold may continue to receive azenosertib, although no additional patients may be enrolled until the partial clinical hold is resolved. We previously disclosed that we are targeting the submission of our first NDA for azenosertib in a gynecologic malignancy in 2026—as disclosed on June 18, 2024, we plan to provide updates on the azenosertib clinical development timelines following resolution of the partial clinical hold.

Previous wording

•Clinical Trial of Azenosertib in Platinum Sensitive Ovarian Cancer (PSOC). We are planning to initiate a clinical trial evaluating azenosertib in PSOC patients in the first-line maintenance setting. We expect to disclose additional details with respect to this trial in the second half of 2024, and to initiate this trial in 2025.

Current wording

•Clinical Trial of Azenosertib in Platinum Sensitive Ovarian Cancer (PSOC). We previously disclosed plans to initiate a clinical trial evaluating azenosertib in PSOC patients in the first-line maintenance setting in 2025 as well as to disclose additional details about this trial in the second half of 2024—as disclosed on June 18, 2024, we plan to provide updates on the azenosertib clinical development timelines following resolution of the partial clinical hold.

Previous wording

•Monotherapy - Phase 2 Clinical Trial in Cyclin E1 Driven High-Grade Serous Ovarian Cancer, Fallopian Tube, or Primary Peritoneal Cancer (HGSOC) (DENALI - ZN-c3-005). We are evaluating azenosertib as a monotherapy in a Phase 2 clinical trial in patients with Cyclin E1 positive platinum resistant HGSOC. Our Cyclin E1 positive enrichment strategy is supported by preclinical data that showed that high Cyclin E1 protein expression sensitized cancer cells to the anti-tumor effects of azenosertib as well as preliminary retrospective clinical data that Cyclin E1 protein levels may be associated with clinical benefit from WEE1 inhibition. In addition, in April 2023, we announced preclinical data at the 2023 American Association for Cancer Research, or AACR, Annual Meeting that demonstrated that azenosertib drove cancer cell death in Cyclin E1-high tumor cellsin vitro and substantially inhibited growth of Cyclin E1-high, patient derived, in vivo tumor models. We expect to disclose topline data from this trial in the first half of 2025.

Current wording

•Monotherapy - Phase 2 Clinical Trial in Cyclin E1 Driven High-Grade Serous Ovarian Cancer, Fallopian Tube, or Primary Peritoneal Cancer (HGSOC) (DENALI - ZN-c3-005). We are evaluating azenosertib as a monotherapy in a Phase 2 clinical trial in patients with Cyclin E1 positive platinum resistant HGSOC. Our Cyclin E1 positive enrichment strategy is supported by preclinical data that showed that high Cyclin E1 protein expression sensitized cancer cells to the anti-tumor effects of azenosertib as well as preliminary retrospective clinical data that Cyclin E1 protein levels may be associated with clinical benefit from WEE1 inhibition. In addition, in April 2023, we announced preclinical data at the 2023 American Association for Cancer Research, or AACR, Annual Meeting that demonstrated that azenosertib drove cancer cell death in Cyclin E1-high tumor cellsin vitro and substantially inhibited growth of Cyclin E1-high, patient derived, in vivo tumor models. On June 18, 2024, we disclosed that we had completed enrollment of Cohort 1b of this trial after enrolling over 100 patients and that we plan to disclose topline results from Cohort 1b of this trial in the second half of 2024.

Previous wording

•Monotherapy/Combination - Phase 1/2 Clinical Trial of Azenosertib as a Monotherapy and with PARP Inhibitor (PARPi) in Platinum Resistant Ovarian Cancer (PROC) (MAMMOTH - ZN-c3-006). We are evaluating azenosertib as a monotherapy and in combination with GSK plc’s, or GSK’s, PARP inhibitor, niraparib (ZEJULA®), in a Phase 1/2 clinical trial in PROC patients who have failed PARPi treatment as part of a clinical collaboration with GSK. This clinical study is supported by preclinical data that showed that combining azenosertib and niraparib resulted in synergistic cell killing in ovarian cancerin vivo models. We expect to disclose topline data from this trial in the second half of 2024.

Current wording

•Monotherapy/Combination - Phase 1/2 Clinical Trial of Azenosertib as a Monotherapy and with PARP Inhibitor (PARPi) in Platinum Resistant Ovarian Cancer (PROC) (MAMMOTH - ZN-c3-006). We are evaluating azenosertib as a monotherapy and in combination with GSK plc’s, or GSK’s, PARP inhibitor, niraparib (ZEJULA®), in a Phase 1/2 clinical trial in PROC patients who have failed PARPi treatment as part of a clinical collaboration with GSK. This clinical study is supported by preclinical data that showed that combining azenosertib and niraparib resulted in synergistic cell killing in ovarian cancerin vivo models. As we reiterated on June 18, 2024, we plan to disclose topline data from this trial in the second half of 2024.

Previous wording

•Monotherapy - Phase 2 Clinical Trial in Recurrent or Persistent Uterine Serous Carcinoma (USC) (TETON - ZN-c3-004). Azenosertib is currently being evaluated as a monotherapy in a Phase 2 clinical trial in patients with USC. As of a September 14, 2022 data cutoff, a total of 43 patients were enrolled and dosed. Azenosertib was well tolerated. The most common treatment related adverse events, or TRAEs, were nausea (60.5% all grades/9.3% grade 3 or higher), fatigue (46.5% all grades/9.3% grade 3 or higher), diarrhea (37.2% all grades/7.0% grade 3 or higher) and vomiting (32.6% all grades/7.0% grade 3 or higher). The FDA granted Fast Track designation in November 2021 to azenosertib in patients with advanced or metastatic USC who have received at least one prior platinum-based chemotherapy regimen for management of advanced or metastatic disease. We believe that the study design in this patient population has the potential to support registration in the United States. We expect to disclose topline data from this trial in the second half of 2025.

Current wording

•Monotherapy - Phase 2 Clinical Trial in Recurrent or Persistent Uterine Serous Carcinoma (USC) (TETON - ZN-c3-004). Azenosertib is currently being evaluated as a monotherapy in a Phase 2 clinical trial in patients with USC. As of a September 14, 2022 data cutoff, a total of 43 patients were enrolled and dosed. Azenosertib was well tolerated. The most common treatment related adverse events, or TRAEs, were nausea (60.5% all grades/9.3% grade 3 or higher), fatigue (46.5% all grades/9.3% grade 3 or higher), diarrhea (37.2% all grades/7.0% grade 3 or higher) and vomiting (32.6% all grades/7.0% grade 3 or higher). The FDA granted Fast Track designation in November 2021 to azenosertib in patients with advanced or metastatic USC who have received at least one prior platinum-based chemotherapy regimen for management of advanced or metastatic disease. We believe that the study design in this patient population has the potential to support registration in the United States. We previously disclosed that we expect to disclose topline data from this trial in the second half of 2025—as disclosed on June 18, 2024, we plan to provide updates on certain of the azenosertib data timelines following resolution of the partial clinical hold.

Previous wording

•Monotherapy - Phase 1b Dose Finding Clinical Trial in Solid Tumors (ZN-c3-001). We are currently evaluating azenosertib as a monotherapy in a Phase 1b dose finding clinical trial for the treatment of solid tumors. On June 6, 2023, we announced positive data from this clinical trial. As of April 24, 2023, a total of 127 heavily pretreated patients with advanced solid tumors were enrolled and received monotherapy azenosertib at doses ≥ 300 mg on either continuous daily dosing or intermittent weekly administration schedules. Across all tumor types, 74 patients received azenosertib on a continuous dosing schedule and 53 patients received azenosertib on an intermittent dosing schedule. When evaluating continuous versus intermittent at comparable clinically meaningful dose levels, the data were the following: intermittent dosing maintained safety and improved tolerability of azenosertib as compared to continuous dosing. Gastrointestinal, fatigue, and hematologic Grade 3 and 4 TRAEs were comparable or favorable versus continuous dosing. No discontinuations due to TRAEs were observed in the intermittent cohorts. Steady state exposure, as measured by AUC 0-24, more than doubled at the intermittent dose of 400 mg, 5 days on, 2 days off, compared to AUC observed at 300 mg daily with continuous administration, and intermittent dosing achieved higher maximal concentration levels as compared to continuous administration. As of June 2, 2023, the confirmed ORR in the combined ovarian and USC subgroup of patients treated with intermittent dosing was 36.8% (7/19), versus 19.2% (5/26) in those who received a continuous dosing. In the response evaluable patients who received intermittent dosing azenosertib, the confirmed ORR was 50% in USC and 30.8% in ovarian cancer. 89% of ovarian cancer and USC patients who received an intermittent dosing schedule had target lesion reductions from their baseline scans. Patients in this subgroup who received an intermittent dosing schedule had a median follow up of 4.4 months, and 63% (12/19) patients remained on therapy as of June 2, 2023. On November 6, 2023, we announced updated data from this trial. Data from October 25, 2023 in the same population of patients (ovarian cancer and USC patients) that were response-evaluable on June 2, 2023, showed that there continued to be a 36.8% (7/19) ORR in these patients. As compared to the June 2, 2023 data, the median follow-up for patients in this subgroup increased to 9.2 months and the mPFS increased to 6.5 months. As of September 27, 2023, azenosertib continued to demonstrate a favorable safety and tolerability profile with additional safety-evaluable patients and longer follow-up. We expect to disclose the final results from this trial in the second half of 2024.

Current wording

•Monotherapy - Phase 1b Dose Finding Clinical Trial in Solid Tumors (ZN-c3-001). We are currently evaluating azenosertib as a monotherapy in a Phase 1b dose finding clinical trial for the treatment of solid tumors. On June 6, 2023, we announced positive data from this clinical trial. As of April 24, 2023, a total of 127 heavily pretreated patients with advanced solid tumors were enrolled and received monotherapy azenosertib at doses ≥ 300 mg on either continuous daily dosing or intermittent weekly administration schedules. Across all tumor types, 74 patients received azenosertib on a continuous dosing schedule and 53 patients received azenosertib on an intermittent dosing schedule. When evaluating continuous versus intermittent at comparable clinically meaningful dose levels, the data were the following: intermittent dosing maintained safety and improved tolerability of azenosertib as compared to continuous dosing. Gastrointestinal, fatigue, and hematologic Grade 3 and 4 TRAEs were comparable or favorable versus continuous dosing. No discontinuations due to TRAEs were observed in the intermittent cohorts. Steady state exposure, as measured by AUC 0-24, more than doubled at the intermittent dose of 400 mg, 5 days on, 2 days off, compared to AUC observed at 300 mg daily with continuous administration, and intermittent dosing achieved higher maximal concentration levels as compared to continuous administration. As of June 2, 2023, the confirmed ORR in the combined ovarian and USC subgroup of patients treated with intermittent dosing was 36.8% (7/19), versus 19.2% (5/26) in those who received a continuous dosing. In the response evaluable patients who received intermittent dosing azenosertib, the confirmed ORR was 50% in USC and 30.8% in ovarian cancer. 89% of ovarian cancer and USC patients who received an intermittent dosing schedule had target lesion reductions from their baseline scans. Patients in this subgroup who received an intermittent dosing schedule had a median follow up of 4.4 months, and 63% (12/19) patients remained on therapy as of June 2, 2023. On November 6, 2023, we announced updated data from this trial. Data from October 25, 2023 in the same population of patients (ovarian cancer and USC patients) that were response-evaluable on June 2, 2023, showed that there continued to be a 36.8% (7/19) ORR in these patients. As compared to the June 2, 2023 data, the median follow-up for patients in this subgroup increased to 9.2 months and the mPFS increased to 6.5 months. As of September 27, 2023, azenosertib continued to demonstrate a favorable safety and tolerability profile with additional safety-evaluable patients and longer follow-up. As we reiterated on June 18, 2024, we plan to disclose the final results from this trial in the second half of 2024.

Previous wording

•Combination - Phase 1 Clinical Trial of Azenosertib and Chemotherapy in Relapsed or Refractory Osteosarcoma (ZN-c3-003). We completed the dose escalation portion of the Phase 1 clinical trial of azenosertib in combination with gemcitabine in adult and pediatric patients with R/R osteosarcoma. We have identified a proposed recommended Phase 2 dose of azenosertib in combination with gemcitabine in this patient population and have seen clinically meaningful activity. We expect that azenosertib in combination with gemcitabine will continue to be evaluated in osteosarcoma in an investigator-initiated trial. We received orphan drug designation and rare pediatric disease designation from the FDA for azenosertib in osteosarcoma. We expect to disclose the final results from this trial in the first half of 2024 at the 2024 American Society of Clinical Oncology Annual Meeting.

Current wording

•Combination - Phase 1 Clinical Trial of Azenosertib and Chemotherapy in Relapsed or Refractory Osteosarcoma (ZN-c3-003). We disclosed the final results from this trial in May 2024, which were subsequently presented in a poster at the 2024 American Society of Clinical Oncology Annual Meeting.

Previous wording

Since inception, we have incurred significant operating losses. Our net loss was $292.3 million for the year ended December 31, 2023. We had net income of $10.0 million and a net loss of $63.3 million for the three months ended March 31, 2024 and March 31, 2023, respectively. We had an accumulated deficit of $878.5 million as of March 31, 2024. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We had cash, cash equivalents and marketable securities of $489.0 million as of March 31, 2024, which includes $56.7 million representing the March 31, 2024 fair value of Immunome common stock received by the Company as part of its upfront payment for the out-licensing of its ROR1 antibody-drug conjugate (ADC) product candidate and ADC platform in January 2024. We believe that our existing cash, cash equivalents and marketable securities as of

Current wording

Since inception, we have incurred significant operating losses. Our net loss was $292.3 million for the year ended December 31, 2023. We had a net loss of $78.2 million and $175.8 million for the six months ended June 30, 2024 and June 30, 2023, respectively. We had an accumulated deficit of $966.8 million as of June 30, 2024. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We had cash, cash equivalents and marketable securities of $426.4 million as of June 30, 2024, which includes $27.8 million representing the June 30, 2024 fair value of Immunome common stock received by the Company as part of its upfront payment for the out-licensing of its ROR1 antibody-drug conjugate (ADC) product candidate and ADC platform in January 2024. We believe that our existing cash, cash equivalents and marketable securities as of June 30, 2024 will be sufficient to fund our operating expenses and capital expenditure requirements into mid-2026. We have based these estimates on assumptions that may prove to be imprecise, and we could utilize our available capital resources sooner than we expect.

Previous wording

In December 2014, our wholly owned subsidiary, Zeno Pharmaceuticals, Inc., entered into a license agreement, or the Recurium Agreement, with Recurium IP Holdings, LLC, or Recurium IP, which was subsequently amended, under which Zeno Pharmaceuticals, Inc. was granted an exclusive worldwide license to certain intellectual property rights owned or controlled by Recurium IP to develop and commercialize pharmaceutical products for the treatment or prevention of disease, other than for providing pain relief. Following certain corporate restructuring disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023, our wholly owned subsidiary, Zeno Management, Inc., or ZMI, became the Zentalis contracting party to the Recurium Agreement. The intellectual property rights exclusively licensed by ZMI under the Recurium Agreement include certain intellectual property covering azenosertib and ZN-d5. ZMI has the right to sublicense its rights under the Recurium Agreement, subject to certain conditions. ZMI is required to use commercially reasonable efforts to develop and commercialize at least one product that comprises or contains a compound modulating one of ten specific biological targets and to execute certain development activities.

Current wording

In December 2014, our wholly owned subsidiary, Zeno Pharmaceuticals, Inc., entered into a license agreement, or the Recurium Agreement, with Recurium IP Holdings, LLC, or Recurium IP, which was subsequently amended, under which Zeno Pharmaceuticals, Inc. was granted an exclusive worldwide license to certain intellectual property rights owned or controlled by Recurium IP to develop and commercialize pharmaceutical products for the treatment or prevention of disease, other than for providing pain relief. Following certain corporate restructuring disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023, our wholly owned subsidiary, Zeno Management, Inc., or ZMI, became the Zentalis contracting party to the Recurium Agreement. The intellectual property rights exclusively licensed by ZMI under the Recurium Agreement include certain intellectual property, including intellectual property covering azenosertib. ZMI has the right to sublicense its rights under the Recurium Agreement, subject to certain conditions. ZMI is required to use commercially reasonable efforts to develop and commercialize at least one product that comprises or contains a compound modulating one of ten specific biological targets and to execute certain development activities.

Previous wording

Under the terms of the Recurium Agreement, ZMI is obligated to make development and regulatory milestone payments, pay royalties on net sales, and make certain sublicensing payments with respect to products that comprise or contain a compound modulating one of ten specific biological targets, including azenosertib and ZN-d5. ZMI is obligated to make development and regulatory milestone payments for each such licensed product of up to $44.5 million. In addition, ZMI is obligated to make milestone payments of up to $150,000 for certain licensed products used in animals. ZMI is also obligated to pay royalties on sales of such licensed products at a mid- to high-single digit percentage. In addition, if ZMI chooses to sublicense or assign to any third parties its rights under certain patents exclusively in-licensed under the Recurium Agreement, ZMI must pay to Recurium IP 20% of certain sublicensing income received in connection with such transaction.

Current wording

Under the terms of the Recurium Agreement, ZMI is obligated to make development and regulatory milestone payments, pay royalties on net sales, and make certain sublicensing payments with respect to products that comprise or contain a compound modulating one of ten specific biological targets, including azenosertib. ZMI is obligated to make development and regulatory milestone payments for each such licensed product of up to $44.5 million. In addition, ZMI is obligated to make milestone payments of up to $150,000 for certain licensed products used in animals. ZMI is also obligated to pay royalties on sales of such licensed products at a mid- to high-single digit percentage. In addition, if ZMI chooses to sublicense or assign to any third parties its rights under certain patents exclusively in-licensed under the Recurium Agreement, ZMI must pay to Recurium IP 20% of certain sublicensing income received in connection with such transaction.

Previous wording

•any delays in clinical trials, including as a result of the global macroeconomic environment;

Current wording

•any delays in clinical trials, including as a result of clinical holds or the global macroeconomic environment;

Previous wording

We expect that our general and administrative expenses will increase in the future as we increase our personnel headcount to support research and development activities relating to our clinical stage programs, and any other product candidates we may develop. We also expect to incur increased expenses associated with being a public company, particularly now that we are no longer an emerging growth company, including costs of accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with Nasdaq and SEC requirements; director and officer insurance costs; and investor and public relations costs.

Current wording

We expect that our general and administrative expenses will increase in the future as we increase our personnel headcount to support research and development activities relating to our clinical stage programs, and any other product candidates we may develop. We also expect to continue to incur expenses associated with being a public company, including costs of accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with Nasdaq and SEC requirements; director and officer insurance costs; and investor and public relations costs.

Previous wording

Research and development, or R&D, expenses for the three months ended March 31, 2024 were $49.6 million, compared to $48.6 million for the three months ended March 31, 2023. The increase of $1.0 million was primarily due to increases of $2.4 million and $2.2 million from drug product and clinical expense, respectively. We also saw increases of $0.7 million and $0.7 million from consulting and R&D cost sharing, respectively. These increases were partially offset by a decrease of $4.7 million in overhead allocations and a $0.3 million decrease of personnel expense.

Current wording

Research and development, or R&D, expenses for the three months ended June 30, 2024 were $48.4 million, compared to $42.7 million for the three months ended June 30, 2023. The increase of $5.7 million was primarily due to increases of $7.4 million for clinical and certain translational expenses and $1.0 million for drug manufacturing and supplies costs. We also saw increases of $1.4 million from no R&D cost sharing with Zentera. These increases were partially offset by a decrease of $2.7 million of personnel expense of which $1.5 million is related to non-cash stock-based compensation and $1.4 million of facilities and allocated expenses.

Previous wording

General and administrative expenses for the three months ended March 31, 2024 were $15.7 million, compared to $16.4 million during the three months ended March 31, 2023. This decrease of $0.7 million was primarily attributable to $0.8 million and $0.7 million decreases in depreciation and other expenses, respectively. This was partially offset by $0.8 million increase related to personnel expense, of which $0.2 million is from non-cash stock-based compensation expense.

Current wording

General and administrative expenses for the three months ended June 30, 2024 were $16.8 million, compared to $15.7 million during the three months ended June 30, 2023. This increase of $1.1 million was primarily attributable to an increase in personnel expenses of $1.3 million and lease termination costs of $0.5 million. This was partially offset by a decrease of other expenses of $0.7 million, net.

Previous wording

We did not record a loss on equity method investment for the three months ended March 31, 2024 compared to $2.3 million for the three months ended March 31, 2023. During the three months ended June 30, 2023, we divested our equity method investment.

Current wording

We did not record a loss on equity method investment for the three months ended June 30, 2024. We recorded a loss on equity investment of $13.7 million for the three months ended June 30, 2023, related to the divestment of our equity method investment.

Previous wording

License revenue for the three months ended March 31, 2024, was $40.6 million compared to zero for the three months ended March 31, 2023. The increase relates to the License Agreement with Immunome entered during the three months ended March 31, 2024.

Current wording

License revenue for the six months ended June 30, 2024, was $40.6 million compared to zero for the six months ended June 30, 2023. The increase relates to the License Agreement with Immunome entered during the three months ended March 31, 2024.

Previous wording

Investment and other income, net was $34.9 million for the three months ended March 31, 2024, compared to $4.1 million for the three months ended March 31, 2023. The increase of $30.8 million was primarily driven by changes in the fair value of Immunome stock for $31.2 million, an increase of $2.3 million in returns on invested cash and marketable securities and $0.4 million of income from the sublease of our New York office. These amounts were partially offset by transaction and other miscellaneous expenses.

Current wording

Investment and other income, net was $12.1 million for the six months ended June 30, 2024, compared to $8.6 million for the six months ended June 30, 2023. The increase of $3.5 million was primarily driven by increases in the fair value of Immunome stock of $2.3 million, an increase of $3.4 million in returns on invested cash and marketable securities and $0.7 million of income from the sublease of our New York office. These amounts were partially offset by transaction and other miscellaneous expenses.

Previous wording

We do not currently have any approved products and have never generated any revenue from product sales. To date, we have financed our operations primarily through the sale of equity securities. From inception through March 31, 2024, we raised a total of $1.2 billion in gross proceeds from the sale of shares of our common stock and convertible preferred units. As of March 31, 2024, we had $37.6 million in cash and cash equivalents, $451.4 million in marketable securities, and an accumulated deficit of $878.5 million. We maintain the majority of our cash and cash equivalents in accounts with major financial institutions, and our deposits at these institutions exceed insured limits. Market conditions can impact the viability of these institutions. In the event of failure of any of the financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position. We had no indebtedness as of March 31, 2024.

Current wording

We do not currently have any approved products and have never generated any revenue from product sales. To date, we have financed our operations primarily through the sale of equity securities. From inception through June 30, 2024, we raised a total of $1.2 billion in gross proceeds from the sale of shares of our common stock and convertible preferred units. As of June 30, 2024, we had $37.0 million in cash and cash equivalents, $389.4 million in marketable securities, and an accumulated deficit of $966.8 million. We maintain the majority of our cash and cash equivalents in accounts with major financial institutions, and our deposits at these institutions exceed insured limits. Market conditions can impact the viability of these institutions. In the event of failure of any of the financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position. We had no indebtedness as of June 30, 2024.

Previous wording

In May 2021, we entered into a sales agreement, or the Sales Agreement, with Leerink Partners LLC, as sales agent, pursuant to which we may, from time to time, issue and sell common stock with an aggregate value of up to $200.0 million in “at-the-market” offerings, or the ATM, under our Registration Statement on Form S-3 (File No. 333-277545) filed with the U.S. Securities and Exchange Commission, or the SEC, on February 29, 2024. Sales of common stock, if any, pursuant to the Sales Agreement, may be made in sales deemed to be an “at the market offering” as defined in Rule 415(a) of the Securities Act of 1933, as amended, or the Securities Act, including sales made directly through The Nasdaq Global Market or any other existing trading market for our common stock. During the quarter ended March 31, 2024, we did not sell any shares of common stock under the Sales Agreement. As of March 31, 2024, there was $140.3 million of our common stock remaining available for sale under the Sales Agreement.

Current wording

In May 2021, we entered into a sales agreement, or the Sales Agreement, with Leerink Partners LLC, as sales agent, pursuant to which we may, from time to time, issue and sell common stock with an aggregate value of up to $200.0 million in “at-the-market” offerings, or the ATM, under our Registration Statement on Form S-3 (File No. 333-277545) filed with the U.S. Securities and Exchange Commission, or the SEC, on February 29, 2024. Sales of common stock, if any, pursuant to the Sales Agreement, may be made in sales deemed to be an “at the market offering” as defined in Rule 415(a) of the Securities Act of 1933, as amended, or the Securities Act, including sales made directly through The Nasdaq Global Market or any other existing trading market for our common stock. During the quarter ended June 30, 2024, we did not sell any shares of common stock under the Sales Agreement. As of June 30, 2024, there was $200.0 million of our common stock remaining available for sale under the Sales Agreement.

Previous wording

Net cash used in operating activities for the three months ended March 31, 2024 was $52.0 million, consisting primarily of our net income of $10.0 million, offset by expenses associated with research and development activities for our product candidates and incurred general and administrative expenses, as well as changes in operating assets and liabilities of $16.3 million, partially offset by non-cash adjustments of $45.6 million.

Current wording

Net cash used in operating activities for the six months ended June 30, 2024 was $87.1 million, consisting primarily of our net loss of $78.2 million as we incurred expenses associated with research and development activities for our product candidates and incurred general and administrative expenses, as well as changes in operating assets and liabilities of $2.2 million, partially offset by non-cash adjustments of $6.7 million.

Previous wording

Net cash used in operating activities for the three months ended March 31, 2023 was $49.3 million, consisting primarily of our net loss of $63.3 million as we incurred expenses associated with research and development activities for our product candidates and incurred general and administrative expenses, and offset by non-cash adjustments of $18.0 million and changes in operating assets and liabilities of $4.0 million.

Current wording

Net cash used in operating activities for the six months ended June 30, 2023 was $128.6 million, consisting primarily of our net loss of $175.8 million as we incurred expenses associated with research and development activities for our product candidates and incurred general and administrative expenses, and offset by non-cash adjustments of $56.4 million and changes in operating assets and liabilities of $9.2 million.

Previous wording

Net cash provided by investing activities for the three months ended March 31, 2023 of $42.1 million was attributable to the proceeds from maturities of marketable securities of $106.0 million, offset by net investment of excess cash of $63.9 million.

Current wording

Net cash provided by investing activities for the six months ended June 30, 2024 of $96.0 million was attributable to proceeds of maturities of marketable securities of $125.7 million, offset by net investment of excess cash of $29.5 million, purchases of property and equipment of $221 thousand and proceeds from sales of property and equipment of $65 thousand.

Previous wording

Net cash provided by investing activities for the three months ended March 31, 2024 of $61.5 million was attributable to proceeds of maturities of marketable securities of $71.7 million, offset by net investment of excess cash of $10.1 million and purchases of property and equipment of $40 thousand.

Current wording

Net cash provided by investing activities for the six months ended June 30, 2023 of $115.1 million was attributable to the proceeds from maturities of marketable securities of $304.5 million, offset by net investment of excess cash of $189.1 million and purchases of property and equipment of $319 thousand.

Previous wording

Net cash provided by financing activities for the three months ended March 31, 2024 of $7.0 thousand consists of $248 thousand provided from the issuance of common stock under equity incentive plans off-set by cash used in the net-settlement of restricted stock unit vesting.

Current wording

Net cash provided by financing activities for the six months ended June 30, 2024 of $16.0 thousand consisted of $257 thousand provided from the issuance of common stock under equity incentive plans off-set by cash used in the net-settlement of restricted stock unit vesting of $241 thousand.

Previous wording

Net cash provided by financing activities for the three months ended March 31, 2023 of $0.4 million was provided from the issuance of common stock under equity incentive plans.

Current wording

Net cash provided by financing activities for the six months ended June 30, 2023 of $237.0 million consists of $235.7 million provided from the issuance of common stock from underwritten offerings and $1.3 million provided from the issuance of common stock from equity incentive plans.

Previous wording

•advance the clinical development of azenosertib and ZN-d5 for the treatment of oncology indications;

Current wording

•advance the clinical development of azenosertib for the treatment of oncology indications;

Previous wording

As of March 31, 2024, we have $2.7 million and $42.6 million in current and long-term lease liabilities, respectively. We believe that our existing cash, cash equivalents and marketable securities as of March 31, 2024 will be sufficient to fund our operating expenses and capital expenditure requirements into mid-2026. We have based these estimates on assumptions that may prove to be imprecise, and we could utilize our available capital resources sooner than we expect.

Current wording

As of June 30, 2024, we have $2.7 million and $41.3 million in current and long-term lease liabilities, respectively. We believe that our existing cash, cash equivalents and marketable securities as of June 30, 2024 will be sufficient to fund our operating expenses and capital expenditure requirements into mid-2026. We have based these estimates on assumptions that may prove to be imprecise, and we could utilize our available capital resources sooner than we expect.

Previous wording

•the progress, costs and results of our clinical trials for our programs for azenosertib and ZN-d5;

Current wording

•the progress, costs and results of our clinical trials for our programs for azenosertib and other product candidates;