Zenas BioPharma shares plunge 51.85% on mixed Phase 3 trial results for obexelimab

Zenas BioPharma’s shares plummeted over 51.85% in pre-market trading on January 6, 2026, following mixed results from its key drug candidate obexelimab in a Phase 3 trial for IgG4-related disease.

The trial showed obexelimab achieved its primary endpoint, reducing flare-up risk by 56% over a year. However, the efficacy fell short of analyst expectations for commercial viability—Jefferies’ Roger Song cited a 65% threshold as critical. Comparisons to Amgen’s Uplizna, which demonstrated an 87% reduction in flares, further dampened optimism despite statistical significance in obexelimab’s data.

Zenas plans to submit a U.S. approval application in Q2 2026, but the stock’s sharp decline reflects investor concerns about competitive positioning. The company holds $297 million in cash but faces quarterly expenses exceeding $50 million. A recent $300 million deal with Royalty Pharma, including upfront and milestone payments, provides liquidity but underscores reliance on obexelimab’s success.

While the drug met all four secondary endpoints and showed favorable safety, the market remains skeptical. Zenas’ broader pipeline, including trials for multiple sclerosis and lupus, remains years from approval, leaving obexelimab as its primary near-term growth driver.

Analysts remain divided on whether the drug can achieve long-term market traction. Some predict strong adoption in niche IgG4-related disease cases, while others argue it lacks differentiation from existing therapies. With over $57 million in R&D costs already invested, the company must now balance regulatory strategy with investor confidence to avoid further capital erosion.

Obexelimab’s performance in Phase 3, while statistically significant, will need to be supported by real-world evidence to justify a price premium over Uplizna and other corticosteroid alternatives. With regulatory approval still pending, the stock remains highly speculative, and its valuation is likely to remain volatile until more clinical data is released.