Conference Transcript - ZNTL 2026-09-08

Seba Forte, Analyst — Wells Fargo

Great. So we're on to our next session. My name is Seba Forte. I'm one of the biotech analysts at Wells. And we have with us today, Julie and Imar. Julie is CEO. Imar is CMO of Zentalis. Thanks so much for being with us.

Julie Eastland, CEO

Well, thanks so much for having us. Yeah.

Seba Forte, Analyst — Wells Fargo

We appreciate you giving us some time today. Great.

Julie Eastland, CEO

So maybe we can start just, you know, high level Zentalis past 12 months, next 12 months. happy to do that and I won't be remiss in mentioning we're going to be making some forward-looking statements and we appreciate those listening taking a look at our SEC filings for the risks and uncertainty around those statements and I have fulfilled my legal obligation so on to your question I have had the pleasure of working with an amazing team the past 12 months and looking forward to the next 12 months as we've accomplished a lot on our agenda with our very focused strategy to bring a Zen assertive to the market for patients in the platinum-resistant ovarian cancer space, in particular for our biomarker-selected population of high expressors of cyclin A1 protein. So in the last 12 months, we have begun and enrolled two parts of our Denali registration-intended study. This is the Denali Part 2 trial where we've enrolled parts a and b and we're currently enrolling cohort 2c in that trial we also have gotten alignment with the agency the fda around our aspenova phase three that is our randomized trial that will not only support accelerated approval but will eventually transition the accelerated approval to full approval and also for global commercialization so a lot going on and we've even started bringing a Xenosertif forward in the ovarian space with our Muir trial part two in combination with bevacizumab and that is in patients who have progressed well

Seba Forte, Analyst — Wells Fargo

on a PARP inhibitor in the first line maintenance setting and we are studying those patients in the second line maintenance setting so lots has happened and maybe I forgot most importantly we have confirmed and selected our monotherapy dose of 400 milligrams a single dose daily uh five days on two days off got it so a lot of stuff to talk about an exciting time so maybe we can start with you know just remind us xeno was under partial fda clinical hold you know try it was tied to treatment related deaths um have you fully addressed the safety signals and you know have you incorporated any monitoring in you know the phase three study yeah thanks do you want to

Ingmar Bruns, Other

addressing them happy to yeah so i like to start by saying that um the fda lifted the hold right without any um request for changes to the dose and the schedule right and uh that's something that of course is important and i have not seen in my career really that uh you know from a hold you know without you know further requests uh the hold was just lifted nonetheless that's something that, of course, drove us to rethink management and study oversight, and that's something when we came in, one of the first things that we started to do, and we moved to really real-time study oversight, that means that we have a bunch of clinical scientists and medical monitors that are really focused on really starting their day by looking at the database, see if there's data missing if there's any signals right something that you know is not left to a zero and but it's really like one of the core focuses of the company right now and then if there's anything that alerts the team then we'll proactively reach out to the investigator more importantly because of course you know you want the investigator to be able to handle the drug right and learn to manage the drug which you know certainly given the profile which we think is very positive uh is possible you know there's an education piece as well right and that's something that we've gone through and where we see this bear fruit uh by you know really you know the um things we preach uh are really adopted by the investigators and the site personnel so that really is important and then lastly we just clarified not on really particular mostly not on severe side effects which are not so many with uh xeno anyway but uh those who are of course impacting convenience and quality of life and there we just strengthened the um anti-medic schedule right anti-diarrheal medication it just has more clarity and it's more straightforward forward and you know also leaves less room for interpretation and that really resonated got it and we want innovation as a class has historically been limited by him talks most famously I would say so I guess what makes us in a therapeutic window differentiated from competitors that maybe haven't been as successful in the past yeah I mean first and foremost you You know, one of the claims, of course, with the Xeno is that it's more selective as a kinase inhibitor, and, you know, that certainly plays a role. But then, you know, even more importantly is that, you know, the 1,000 patient experience, which, you know, eventually didn't take 1,000 patients, but now it is experience of 1,000 patients that led us to the 5-on-2-off schedule, which is not an uncommon thing, of course. But then again, together with a dose, it takes a long time to establish and be confident in. And I think that's really one of the big accomplishments to have found, you know, a good therapeutic window in this narrow therapeutic index space, right, that is nonetheless is. And that also makes it hard for any followers, right, because it does take a lot of patience and time to figure this out. And, you know, that's something that we think is really key because it is an ideal scenario with all the schedules tested where you have enough target engagement, where you have enough exposure over time, but then, you know, also give the window for recovery for those patients, which really, you know, sounds trivial, but really makes all the difference.

Julie Eastland, CEO

I think just to add the context here that hematological events actually in Denali Part 1b were pretty modest in terms of incidence. When you think about grade 3 neutropenia rates, which were, I think, grade 3 and above were, what, 12 percent? That's a very low percentage when you think about some of the data you see coming out of some of the ADCs where grade 3 treatment-related neutropenia was at 45 percent. So this really isn't so much a differentiated profile than other oncology drugs, it's just that it has been overwhelmed with the perception because of the two grade five events in Part 1b, which had a lot of, of course, factors involved, but importantly, again, as Ingmar noted, when you look at the totality of the patients that have seen a xenocertive and monotherapy are in combination this safety profile is is quite good got it how much of this heme talks bothers patients versus the physicians that are actually a great question so say again how much

Ingmar Bruns, Other

does it the heme talks bother patients yeah i mean patients uh because it doesn't hurt usually right neutropenia only hurts if you get an infection and not until then and the majority of patients of course you know don't have febrile neutropenia and don't have actual infections fortunately because if that happens then uh we of course and the investigators react um it bought it used to bother physicians in the beginning because there was really the reputation of the drug in the class and that really changed right just adding to what julie just said i mean the neutropenia rate is low double digits right you know to be precise 11 12 percent um and half of that at least uh is grade three so any kind of high grade neutropenia really is a rare event if you compare this with standard of care chemotherapy or most of the adcs then you know that's really very favorable and thrombocytopenia even less so right there you know the grade four is a rare um you know high rate is also a low percentage um that's not something that a patient would ever feel because usually you don't really see bleeding or anything we haven't seen that and uh you know that's the same right you know um what you know is uh certainly something that a patient could be bothered by is anemia but again same situation there the rate is pretty low and that's what i said initially right so the majority we're dealing with is is more gi um is fatigue which is hard because it's a multifactorial process right a lot of it is uh driven by the disease the circumstances of course right of you know having this potential terminal illness and uh and then partially of course also by the drug without knowing the exact mechanism here right got it very helpful.

Seba Forte, Analyst — Wells Fargo

Maybe just going back to the 5-2 schedule that you were mentioning, I mean, it's been central to tolerability, but is there any risk that it compromises efficacy by incomplete pathway suppression?

Ingmar Bruns, Other

No, I don't think it's really a matter of the complete pathway suppression, right? So as you know, of course, right, it doesn't require a permanent suppression of the pathway, If you look at the mechanism in particular that really wants to drive these rapidly dividing cells into cell cycle, avoiding DNA repair, they're all damaged because they're tumor cells and eventually leading to mitotic catastrophe. That's not something that needs to be absolutely continuous. it should just be most of the time and we think that you know and that's why the five on two off is important we need the exposure to be above the threshold right to hit the target hard enough we know that right and that's also you know something that you know drives a very clear differentiation between 300 and 400 milligrams so the schedule matters and we're not worried about two days Sometimes patients have to do treatment interruptions, right, to manage, you know, some of the side effects. And we know that for a while this is not a problem. We just need to ensure that, you know, you don't have gaps of, you know, multiple weeks or so. Then you see that, you know, the tumor markers start to increase. And then, you know, likelihood of relapse is, you know, increased and higher. So it is important, but it's not a matter of continuous and complete blockage of the pathway, right? It's just, given the mechanism, not that important.

Seba Forte, Analyst — Wells Fargo

Got it. And maybe just touching on, you know, Denali part two, the top lane readout, we're expecting it in the first half of 2027. What does a win look like for this readout?

Julie Eastland, CEO

Yeah, that's a great question. and I think we've got a number of things to think about there. First off, as we're thinking about the Denali Part II population and where it is looking to make improvements, we know that single-agent chemotherapy is the standard of care globally and that we see response rates there in 4% to 13%. And our primary endpoint in Denali Part II is overall response rate. We've also seen in all of our historical studies in the PROC setting for cyclin A1 patients, and that includes our dose escalation trial, the Mammoth trial, which was PARP experience patients, as well as Denali 1B, which was all PROC patients. We see in those studies where we have overall response rates at 30 plus percent. That's clinically meaningful when you think back to Eliheer and its trials against single agent chemotherapy and their response rates in that range we certainly see a win here against single agent chemo of around 30 percent or greater and duration of response that's five months and better that's going to be a win the bigger the number the bigger the win got it and what does this mean commercially again from a clinical meaningful perspective it's important that that is a significantly better opportunity for patients to have a response and have a duration of response over their options, which is more chemo. As you think about the patient journey coming into P-ROC, it's been a lot of chemotherapy, and their options coming into P-ROC are mostly chemotherapy options. I think all of them are. Most of them IV infusion. So really, a Xenoserva is going to offer a great opportunity for patients to have a chemo break those patients who have high cyclin e1 disease have a high correlation to this response and that's clinically meaningful over what their options are today got it and i believe you haven't shared what's the cutoff for cyclin e1 expression but you have mentioned it's about 50 of patients so like how reproducible you think this is in a phase three and also how are you thinking about the companion diagnostic or like requirements at this point so i'll talk about the companion diagnostic you can talk about the uh the cutoff but we haven't disclosed the cutoff uh yet but we do know that when we look retrospectively across all of these trials that i mentioned before what we've seen is about 50 percent of the patients in our historical studies have screened positive for our cutoff for high cyclin so that's where the 50 percent of the p rock population comes from on it that assay has been very well developed over the past many years and is in a very good place and being used prospectively to screen patients in denali and aspenova to validate the assay for regulatory approval, which is on track to align with the therapeutic timeline for approval as well. So those two we plan to submit together and have both the CDX and the therapeutic approved contemporaneously.

Seba Forte, Analyst — Wells Fargo

Got it. And at what point would these patients get tested?

Ingmar Bruns, Other

Is this something that you could incorporate earlier in the treatment algorithm, or is this something that as patients continue to progress maybe they would consider you know the test do you want to talk about that yeah so at the moment right if you talk look at the studies um it's archival tissue right which you know is an important advantage uh because you can basically use the specimen from the original surgery and i don't have to undergo biopsy which you know of course in academic centers is not a huge hurdle but for the patient is an invasive procedure that clearly is an advantage if you can base your diagnostic on an archival tissue and then we're allowing for the studies a very wide screening, pre-screening window so you can basically enroll or pre-screen a patient when still on an active line of treatment. There's no restriction to this. And that's something that if you look towards post-launch, then, of course, the plan is to establish this in the standard diagnostic panels. So you already have this as a physician for your patient, right, in the case of, unfortunately, very realistic progression down the road.

Julie Eastland, CEO

Yeah, the goal would be a diagnosis, utilizing the tumor tissue that we would hope that patients would be screened for their cyclin E1 status. And should they become PROC patients, they would already know they have an opportunity to utilize as an assertive.

Seba Forte, Analyst — Wells Fargo

Got it. And how flexible is this cutoff? Like, is there a chance that once you get the data, you go back to the FDA and it's like, hey, maybe let's shift the cutoff? Or is this something that's very well established and it's not movable at all?

Ingmar Bruns, Other

So it is very well established, right, because it's really, you know, through a very rigorous process. So initially it was retrospectively validated, right, going through mammoth, Denali part one, even the original dose escalation. And then now for the second part of Denali and Aspenova, the FACE-3 trial, it's prospectively validated. So that's really the gold standard of doing this. So that's really something that we also perceived as extremely robust, because if you see patients that, the few patients that respond, even though they're below the threshold, they're very, you know, they're just below. If you look at the ones that have no expression, there's no responders, right? Right. And there's very few. So the specificity of the test is really excellent. And, you know, we don't see to, you know, at this point, really the need to adjust this. And it's also a pretty strong competitive advantage, right, over others who, you know, in their registrational trials still have to, you know, validate and determine the schedule.

Seba Forte, Analyst — Wells Fargo

Right. Okay. Very helpful. Maybe just talking a little bit about Denali Part 2C, what drove the inclusion of this patient population and change in landscape?

Julie Eastland, CEO

Or was it something that was required by the FDA or something that you decided to do on your own? yeah I'll take this one and then Ingmar can help me out if he needs to but this was actually really straightforward it was clear that there were going to be PDUFA dates for some additional taxing combinations in the first part of this year and we decided to be ready to initiate a cohort that would enable us to strengthen and add to our population in Denali part two overall parts a b and now c for patients who have an opportunity uh to see taxanes in the p rock setting we already have patients in our study who've seen some taxanes in the p rock setting but now patients have an opportunity to experience that in some additional combination therapies and so we took the initiative to open up cohort 2c um and we expect to have all three of our cohorts a b and c at the 400 milligrams be an integrated data set to support uh accelerated approval going forward got it was there any like you've previously mentioned the part to see what's kind of like the reason why the readout was pushed back a little bit is there anything about enrollment that wasn't expected or just the fact that you need to operationally yeah as you as you might remember for the audience to uh just to have them remember the um denali part a and b began enrollment in 2025 and finished up this summer for parts a and b part c cohort 2c was operationalized earlier this year so it was already starting its enrollment after we had been enrolling a and b so it's just really there's the timing of that cohort based on obviously the landscape and we want to make sure that we have time for those patients to not only get through their evaluations for their overall response points but also have some time to develop maturity for duration of response and so it's just unfortunately the last sort of set of patients in will drive the timing for an integrated look at all parts got it is there any reason to believe

Ingmar Bruns, Other

or to expect different efficacy levels for this cohort 2c versus cohort a and b No, if so, you could argue biologically, you know, this patient subpopulation could be more susceptible to V1 inhibition because given that, you know, they had already prior repeated palytaxel exposure, which, you know, of course causes a lot of like, you know, spindle and chromosomal misalignments that, you know, there's more DNA damage. and there's more metodic catastrophe in the end. But, you know, we do expect like a similar result there. There's certainly not any cross resistance or, you know, to be expected or a large impact of, you know, more prior lines of treatment. So, like, no. Got it.

Seba Forte, Analyst — Wells Fargo

Okay, very helpful. Maybe just, so you're running Denali, right, for accelerated approval. You're running Espinova as a phase three confirmatory trial. How much of Aspinova's design is already locked in with the FDA versus what remains open?

Julie Eastland, CEO

At the end of last year, we met with the agency to align on the design for Aspinova, including the control arm for Aspinova, the size, the primary endpoints being PFS with secondary endpoints of OS and ORR. So that design was discussed with the agency. We did that early prior to the selection of the dose so that we could begin to operationalize that phase three and begin enrollment in that trial to help support, of course, not only the timeline for full approval, but also to support Denali's accelerated approval pathway. Because, as you know, the agency requires a randomized controlled study to have been started or near enrollment at the time of the review period for accelerated approval. And so we are enrolling Aspinov. It will be a global trial. We'll have a much larger footprint than the Denali study. And so we are on our way with that effort.

Seba Forte, Analyst — Wells Fargo

Got it. Are there any concerns that, you know, the potential accelerated approval or, as I know, is an issue for enrolling as Panova?

Ingmar Bruns, Other

Yeah, I mean, as you know, in the U.S., of course, it will limit enrollment a little bit. Globally, not, right? And that's why, you know, these trials have to have a global footprint.

Julie Eastland, CEO

But Denali, you know, parts A and B are fully enrolled. Part 2C, you know, is about 40 patients. It'll just be determined when we see the benefit we want to see from 2C. But nonetheless, that will be a small overlap with Aspinova. And the majority, I think, of sites that are interested in Denali will then convert over into the Aspinova study because we want the patients that have had experience with Denali to be able to have those physicians move their new patients into Aspinova. So I think it'll be complementary and not a significant overlap in terms of enrollment competition.

Ingmar Bruns, Other

For that, yes, right? But, you know, of course, if it's commercially available, then you'll see that, of course, the desire to participate in a trial is a little bit lower. But that's something that we accounted for, right? And, you know, and that's a challenge that every clinical trial, of course, faces if you have the accelerated approval separately.

Seba Forte, Analyst — Wells Fargo

Got it. Okay, very helpful. Maybe just in terms of you had recent interactions with the FDA through a type D meeting. Can you just, you know, discuss with us a little bit how did those interactions look like and were they more on the positive end and how do they impact your strategy?

Julie Eastland, CEO

Yeah, I'll just say we've been very fortunate to have the same team, certainly since Ingmar and I joined in 2024. That's been very responsive and very supportive. Do you want to run through the Type-D meeting, Ingmar?

Ingmar Bruns, Other

Yeah, of course. So, yeah, I think I just echo what Julie said, right? So they certainly know that despite some new entrants to the landscape, there's still remaining unmet need that's very significant right because we know that with not even approved yet but the additional ADCs eventually will probably move into the front lines and then you know leave a gap right and then the new Texane regimens are of course great for patients but they also just you know a fit for a relatively small subset of patients because of the palytaxel or napalytaxel backbone which of course limits the use quite a bit right right now we're looking at about 10 percent of palytaxel single agent use and that's not for lack of efficacy right because the efficacy of single agent palytaxel weekly palytaxel is excellent amongst the chemotherapy options there, but it's still not used that much because of the toxicities, some of the toxicities that, you know, very durable from the front line, right, when it's used every three weeks. So this is something for 10-15% of patients, right, and that is a great option with, you know, of course increased survival data, but that leaves a lot of room, right, and the agency and especially the group that julie mentioned they're very well aware of this and uh you know they they want to see additional uh treatment options here and especially like a completely separate differentiated mechanism right where you don't expect any resistance cross resistance to uh the existing and emerging therapies got it maybe talking within this you know evolving landscape one of the things we hear the most is you know for the receptor alpha abcs and how we're going to be getting some of this phase three data for the next gen towards you know the end of this year fourth quarter how do you see that impact your strategy and the commercial viability of a xeno do you want to talk about the the clinical or the regulatory aspects i'll talk about the commercial yeah of course yeah I think I mean clinically um you know as you know um for the new uh folate receptor alpha um ADCs um you need a full approval to you know be um in the way of uh um is there no approval where we don't see an issue here right now and um and then again uh we don't know for those that if they're really agnostic to folate receptor alpha expression so that's something that remains to be seen but you know certainly we see that you know as I said before as I know is a very viable and differentiated option here and then at the same time of course we're dealing with the existing morvatuximab folate receptor alpha targeting drug where we also need to understand, right, if, you know, a patient expresses folate receptor alpha or is a high expressor at the same time expresses cyclin E1, right, what do you do? And, of course, we're not unbiased here, but, you know, I think given that patients just come off chemotherapy, we certainly think it's more favorable to give them a break, right, rather than have a cytotoxic agent, which, you know, essentially the payload of and ADC is, as you know, right after. So that really comes down to clinical judgment. And for the newer folate receptor alpha as I already said, drugs, we'll have to see, right, if, you know, if they will be expression agnostic or not. I personally have some challenges seeing this, you know, from a regulatory perspective, but that's, of course, speculation.

Julie Eastland, CEO

And I think from a clinical experience, We have marvotuximab, you know, treated patients or previously exposed patients, both in Denali Part 1b, but also in our Part 2 study. So we know folate receptor alpha experienced patients or agents that target folate receptor alpha. These are patients that we can treat and can benefit from as an assertive. I think Ingmar's really hit the nail on the head when it comes commercially. Azeno's profile is differentiated as being a non-chemo oral option. that's important specifically for our biomarker population keeping in mind that our target is really part of the disease pathway that cancer hijacks being a wee one inhibitor these targeted ADCs are targeting the cell surface or protein receptors on cancer cells it's a different type of targeted therapy and we think again as Ingmar mentioned the commercial strategy here really is to bring this drug to these patients who typically have been known in the earlier lines of ovarian cancer to not do as well, to progress faster, and have seen a lot of chemotherapy, cumulative side effects, and this is an option with the Zen Assertive, to avoid that for some period of time and then have at it with more chemo, whether it's single agent or it's an ADC with a chemo payload, that's still all chemo, it's just new chemo. So we really think there's an opportunity here to give patients a break. And that really is more important than anything scientifically. Got it. What's the overlap, the patient overlap with the folate receptor alphas? It's about 20% of all PROC patients. So it's a small fraction of our population. Of course, 50% of our population of the PROC is, we think, is an assertive addressable. And then there's a smaller percentage there that might overlap. happen for those patients that have both of those indications as expressing folate receptor alpha high and cycloneo and high, then it really just comes down to sequencing which drug they're going to get. They'll have the opportunity potentially for both.

Seba Forte, Analyst — Wells Fargo

Got it. Makes sense. And beyond folate receptor alpha, I mean, that's the one that we hear about the most, but are there other mechanisms that you're tracking?

Julie Eastland, CEO

I think in all the sort of ADC classes, it select your target but you're delivering topo one payload and we know from experience in other settings physicians tell us they look to breast cancer experience where similar adcs with the same payload are utilized in sequence where there's very little benefit from additional therapy of a topo one after topo one and that certainly is what ovarian cancer patients and physicians are looking at to understand what would be the added benefit of seeing eight of these ADCs in a row. It's likely not going to be something that physicians use. So there will be a winner. It'll be great. This is a population that really needs options. There's such a dearth of opportunity for patients in this setting. We welcome all of these agents coming on board. We just believe our differentiated agent, our agent for these patients in P-ROC should see this drug first. got it and you also showed some combination data earlier this year maybe can you walk us through your strategy there and like what is it going to take for you to continue development down the combination path yeah and we we have some uh current open enrollment in our ongoing mirror trial which is a combination of a xeno plus bevacizumab in the platinum sensitive setting that's in the second line maintenance for patients that progressed well on a PARP inhibitor So that trial is enrolling, and we'll look to see both. We already know what our combination dose there is, and we'll look to see some signals hopefully from that study next year. In addition to that, what you're mentioning is the data that was presented at ASCO earlier this year in combination with Paclitaxel, which was really a very nice data set that saw a real additive benefit to Paclitaxel with the zen assertive at a combination dose of 250 milligrams for zen assertive so i think it tells us a couple things you don't need the monotherapy dose always in a setting where you're combining with another cytotoxic agent which is also driving the process of cell cycle stress and then additionally to that this population was an all-comer population so we really see a synergy with other agents where they may not all be cyclin E1 driven as a necessity in combination with these other agents. So we're going to continue to expand in other areas, looking for other combinations and other tumor types to continue on what is really the promise of We1 inhibitor, which is to be not only a good monotherapy agent, but a good partner in combination with other cytotoxic agents across many settings.

Seba Forte, Analyst — Wells Fargo

Got it. Very helpful.

Julie Eastland, CEO

Maybe just last question um cash runway and what's included yeah we very much appreciate uh the investors who've come into the story and who continue to support us and our existing investors we just raised some money recently and that will extend our runway into the first half of 28 um well beyond a year or so beyond our data readout for denali so we're in a good position uh to support Denali, to support a registration filing, and to support, of course, the Espinova trial and its enrollment.

Seba Forte, Analyst — Wells Fargo

Got it. Very helpful. Exciting times for Zentalex. Congratulations, and thanks so much for joining us.

Julie Eastland, CEO

Yeah, thanks for having us. We appreciate it.