Zentalis (ZNTL) has upside potential even with a competitive landscape




Quick Diligence: Zentalis has upside potential, even with a competitive landscape.


Zentalis (ZNTL) is a biotech developing small molecule drugs against validated oncology targets, but with improvements over currently approved drugs. These targets include selective estrogen receptor degrader (SERD), EGFR, as well as emerging targets Bcl-2 and WEE1. Zentalis's lead asset is its SERD drug, ZN-c5, currently in Phase 1/2. ZN-c5 is being developed for certain types of breast cancer, where Fulvestrant, a SERD drug by AstraZeneca, was able to achieve blockbuster status. However, Fulvestrant has noted safety and IV administration issues that ZN-c5, an oral drug, could improve upon and become a best-in-class SERD. Zentalis is not presenting meaningful data updates at ASCO today, but AstraZeneca, Roche, and Sanofi will be presenting early data on their oral SERD drugs, which will have some readthrough to Zentalis.


Zentalis has been on our radar for the past month, and promising updates at ASCO today could move it up some more, but SERD is a very competitive field with close to 10 other drugs in development, so we're holding steady for now and may revisit the stock closer to the Phase 1 readout in 2H20 if competitor data looks promising.