Memorandum
Zafgen recently provided its 4Q16 and year-end update via news release. The biggest announcement was that the company is on track to complete dosing of MetAP2 inhibitor ZGN-1061 for a phase 1 trial in adults with obesity by end of 1Q17, with results expected in early 2Q17. If data is positive, Zafgen will launch a phase 2 study of ZGN-1061 in Australia in 2H17. Notably, the company is working to differentiate ZGN-1061 from its predecessor beloranib, which was discontinued last year due to two thrombosis-related deaths – the 4Q16 news release emphasizes how non-clinical studies of ZGN-1061 have demonstrated an improved safety margin vs. beloranib. There were few specifics and of course we would be very interested in learning more on this). It’s a very challenging market for obesity pharmacotherapies to be sure – stigma prevails, providers are reluctant to prescribe weight loss agents and need to be more convinced of their safety (especially in the context of discontinuations like beloranib’s), and reimbursement prospects are poor for the most part though successes like Novo Nordisk’s Saxenda show that success is certainly possible (Saxenda’s revenue was just under $300 million in 2016). We’re happy to see Zafgen’s ongoing commitment to obesity as a therapeutic area, since the chronic condition is still widely undertreated.
As of December 31, 2016, Zafgen had $129.2 million in cash remaining. The company reported a net loss of $10.4 million or $0.38/share in 4Q16, compared to a net loss of $23.2 million or $0.85/share in 4Q15. We’ll be keeping an eye on Zafgen and on ZGN-1061, with our fingers crossed for swift clinical progress.
-- by Payal Marathe and Kelly Close