Daiichi Sankyo Selects Lead Candidate Built on Zymeworks’ Azymetric™ Bispecific Platform

• One of three bispecific immuno-oncology therapeutics being
  developed under the two companies’ collaboration agreements
• Zymeworks to receive US$3.5 million commercial license payment from
  Daiichi Sankyo

VANCOUVER, British Columbia VANCOUVER, British Columbia & TOKYO & BASKING RIDGE, N.J.–(BUSINESS WIRE)–Zymeworks Inc. (NYSE/TSX: ZYME), a clinical-stage biopharmaceutical
company developing multifunctional biotherapeutics, and Daiichi Sankyo
Company, Limited (“Daiichi Sankyo”) announced today that Daiichi Sankyo
has exercised its option for a commercial license to a proprietary
immuno-oncology bispecific built on Zymeworks’ Azymetric™ and EFECT™
platforms. Zymeworks will receive a US$3.5 million payment based on
Daiichi Sankyo’s selection of the first of up to three lead product
candidates under its collaboration agreements with Zymeworks.

“This is another example of how our Azymetric platform can facilitate
the rapid selection and development of bispecific antibody candidates
for our pharmaceutical partners,” said Ali Tehrani, Ph.D., President and
CEO of Zymeworks. “We are thrilled to see Daiichi Sankyo move this novel
therapeutic program into late-stage preclinical development. This is an
important step forward towards our shared goal of improving the standard
of care for patients with cancer.”

“Our partnership with Zymeworks has allowed us to develop therapeutic
candidates based on complex mechanisms of action such as immune cell
engagement,” said Antoine Yver, M.D., M.Sc., Executive Vice President
and Global Head, Oncology Research and Development, Daiichi Sankyo.
“Through this partnership, we have identified a novel bispecific
therapeutic that we are excited to be advancing towards the clinic. We
look forward to continuing our strong partnership with Zymeworks to
develop novel therapeutic options for patients with cancer worldwide.”

Under the terms of the 2016 cross-licensing and collaboration agreement,
Zymeworks granted Daiichi Sankyo a license to Zymeworks’ Azymetric™ and
EFECT™ platforms to develop a bispecific antibody therapeutic for which
Zymeworks is eligible to receive further clinical and commercial
milestone payments of up to US$143.4 million, as well as up to
double-digit tiered royalties on global product sales. Additionally,
Zymeworks obtained a license to certain immuno-oncology antibodies from
Daiichi Sankyo, with the right to research, develop, and commercialize
multiple bispecific products globally in exchange for royalties on
global product sales.

About the Azymetric™ Platform

The Azymetric platform enables the transformation of monospecific
antibodies into bispecific antibodies, giving the antibodies the ability
to simultaneously bind two different targets. Azymetric bispecific
technology enables the development of multifunctional biotherapeutics
that can block multiple signaling pathways, recruit immune cells to
tumors, enhance receptor clustering degradation, and increase
tumor-specific targeting. These features are intended to enhance
efficacy while reducing toxicities and the potential for drug
resistance. Azymetric bispecifics have been engineered to retain the
desirable drug-like qualities of naturally occurring antibodies,
including low immunogenicity, long half-life, and high stability. In
addition, they are compatible with standard manufacturing processes with
high yields and purity, potentially significantly reducing drug
development costs and timelines.

About the EFECT™ Platform

The EFECT platform is a library of antibody Fc modifications engineered
to modulate the activity of the antibody-mediated immune response, which
includes both the up- and down-regulation of effector functions. This
platform, which is compatible with traditional monoclonal as well as
Azymetric bispecific antibodies, further enables the customization of
therapeutic responses for different diseases.

About Zymeworks Inc.

Zymeworks is a clinical-stage biopharmaceutical company dedicated to the
development of next-generation multifunctional biotherapeutics. The
Company’s suite of therapeutic platforms and its fully integrated drug
development engine enable precise engineering of highly differentiated
product candidates. Zymeworks’ lead clinical candidate, ZW25, is a novel
Azymetric™ bispecific antibody currently in Phase 2 clinical
development. The Company’s second clinical candidate, ZW49, is a
bispecific antibody-drug conjugate currently in Phase 1 clinical
development and combines the unique design and antibody framework of
ZW25 with Zymeworks’ proprietary ZymeLink™ cytotoxic payload. Zymeworks
is also advancing a deep preclinical pipeline in immuno-oncology and
other therapeutic areas. In addition, its therapeutic platforms are
being leveraged through multiple strategic partnerships with eight
global biopharmaceutical companies. For more information, visit www.zymeworks.com.

About Daiichi Sankyo Cancer Enterprise

The mission of Daiichi Sankyo Cancer Enterprise is to leverage our
world-class, innovative science and push beyond traditional thinking to
create meaningful treatments for patients with cancer. We are dedicated
to transforming science into value for patients, and this sense of
obligation informs everything we do. Anchored by three pillars including
our investigational Antibody Drug Conjugate Franchise, Acute Myeloid
Leukemia Franchise and Breakthrough Science, we aim to deliver seven
distinct new molecular entities over eight years during 2018 to 2025.
Our powerful research engines include two laboratories for
biologic/immuno-oncology and small molecules in Japan, and Plexxikon
Inc., our small molecule structure-guided R&D center in Berkeley, CA.
Compounds in pivotal stage development include: [fam-] trastuzumab
deruxtecan, an antibody drug conjugate (ADC) for HER2 expressing breast,
gastric and other cancers; quizartinib, an oral selective FLT3
inhibitor, for newly-diagnosed and relapsed/refractory FLT3-ITD
acute myeloid leukemia (AML); and pexidartinib, an oral CSF1R inhibitor,
for tenosynovial giant cell tumor (TGCT). For more information, please
visit: www.DSCancerEnterprise.com.

Zymeworks Cautionary Note Regarding Zymeworks’ Forward-Looking
Statements

This press release includes “forward-looking statements” within the
meaning of the U.S. Private Securities Litigation Reform Act of 1995 and
“forward-looking information” within the meaning of Canadian securities
laws, or collectively, forward-looking statements. Forward-looking
statements in this news release include, but are not limited to,
statements that relate to future development activities in accordance
with the terms of Zymeworks’ agreements with Daiichi Sankyo, potential
payments and/or royalties payable to Zymeworks under these agreements,
the speed and outcome of drug development plans, Zymeworks’ potential
global growth, and other information that is not historical information.
When used herein, words and phrases such as “enable”, “will”, “may”,
“eligible to”, and similar expressions are intended to identify
forward-looking statements. In addition, any statements or information
that refer to expectations, beliefs, plans, projections, objectives,
performance or other characterizations of future events or
circumstances, including any underlying assumptions, are
forward-looking. All forward-looking statements are based upon
Zymeworks’ current expectations and various assumptions. Zymeworks
believes there is a reasonable basis for its expectations and beliefs,
but they are inherently uncertain. Zymeworks may not realize its
expectations, and its beliefs may not prove correct. Actual results
could differ materially from those described or implied by such
forward-looking statements as a result of various factors, including,
without limitation, market conditions and the factors described under
“Risk Factors” in Zymeworks’ Annual Report on Form 10-K for its year
ended December 31, 2018 (a copy of which may be obtained at www.sec.gov and www.sedar.com).
Consequently, forward-looking statements should be regarded solely as
Zymeworks’ current plans, estimates and beliefs. Investors should not
place undue reliance on forward-looking statements. Zymeworks cannot
guarantee future results, events, levels of activity, performance or
achievements. Zymeworks does not undertake and specifically declines any
obligation to update, republish, or revise any forward-looking
statements to reflect new information, future events or circumstances or
to reflect the occurrences of unanticipated events, except as may be
required by law.

Contacts

Daiichi Sankyo
Jennifer Brennan
(908)
992 6631 (office)
(201) 709 9309 (mobile)
[email protected]

Zymeworks Inc.
Investor
Inquiries:
Ryan Dercho, Ph.D.
(604) 678-1388
[email protected]
Tiffany
Tolmie
(604) 678-1388
[email protected]
Media
Inquiries:
Angela Bitting
(925) 202-6211
[email protected]