Epizyme, Inc. Reports Second Quarter 2013 Financial Results

         Epizyme, Inc. Reports Second Quarter 2013 Financial Results

Successfully Completed Initial Public Offering and Advanced Second
Personalized Therapeutic Program into Clinical Development

$6 Million Clinical Development Milestone Earned from Eisai

PR Newswire

CAMBRIDGE, Mass., July 31, 2013

CAMBRIDGE, Mass., July 31, 2013 /PRNewswire/ -- Epizyme, Inc., (NASDAQ: EPZM)
a clinical stage biopharmaceutical company creating innovative personalized
therapeutics for patients with genetically defined cancers, today provided a
corporate update and reported financial results for the second quarter ended
June 30, 2013.

"The second quarter was transformative for Epizyme. We completed a successful
IPO, ending the period with $149 million in cash and cash equivalents,"
commented Robert Gould, Ph.D., CEO of Epizyme. "We now have two programs in
clinical development. The dose escalation study is ongoing for EPZ-5676, our
therapeutic candidate for the treatment of acute leukemia patients with mixed
lineage leukemia (MLL-r), and we plan to initiate the expansion cohort stage
of this study later this year. In June, we initiated clinical development of
our second program, EPZ-6438, our therapeutic candidate for the treatment of
non-Hodgkin lymphoma patients with oncogenic point mutations in EZH2. As a
result of the initiation of the clinical development of EPZ-6438, we earned a
$6 million milestone from our partner Eisai, which was received in July. Our
collaborations with Celgene, Eisai, and GSK are important elements of our
business strategy, including our retained United States rights for EPZ-5676
and EPZ-6438, and as sources of potential future milestones and royalties.
Today, we are in a strong position to invest in and expand Epizyme's product
platform and pipeline of therapeutic programs. We look forward to additional
progress across the Company this year."

Recent Business Highlights

  oCompletion of Initial Public Offering Epizyme announced on June 5, 2013,
    that it had completed its initial public offering of common stock, raising
    gross proceeds of $88.7 million.
  oContinued Progress with EPZ-5676 Development Epizyme is enrolling patients
    in the dose escalation stage of its Phase 1 study of EPZ-5676 and has
    added four clinical sites in 2013 for a total of five active sites at this
    time. The Company expects to initiate an expansion cohort later in the
    year, limited to patients with MLL-r, in as many as twelve sites in both
    the United States and Europe. In June, Epizyme scientists published
    pre-clinical data on EPZ-5676 in the journal Blood, showing the
    correlation between DOT1L inhibition and anti-proliferative effects
    specific to MLL-r leukemias, including tumor growth inhibition and durable
    anti-tumor effects in animal models that were sustained after dosing had
    been completed.
  oCompanion Diagnostic Collaboration for EPZ-5676 In April, Epizyme
    announced a collaboration with Abbott Molecular Inc. to develop a
    molecular companion diagnostic to identify eligible patients for EPZ-5676.
  oInitiation of Phase 1/2 Clinical Trial for EPZ-6438 In June, Epizyme
    announced the enrollment of its first patient in a Phase 1/2 study of
    EPZ-6438 (referred to as E7438 by Eisai). Epizyme plans to initiate the
    Phase 2 portion of this study in 2014.
  oIntellectual Property In April, the Company was granted the first patent
    covering the composition of matter of EPZ-6438. This patent expires in
    2032. In addition, in April, the US Patent and Trademark Office issued a
    Notice of Allowance for a patent application titled "Diagnostic and
    Therapeutic Targets for Leukemia" with claims directed to methods of
    identifying DOT1L inhibitor compounds for the treatment of leukemia. The
    patent to be issued from this application carries a patent term to at
    least 2030.
  oPipeline Development Epizyme continues to conduct preclinical studies to
    identify additional genetically defined cancers for potential treatment
    with its therapeutic candidates. In April, Epizyme scientists published a
    paper in Proceedings of the National Academy of Sciences, demonstrating
    the effectiveness of a potent, selective EZH2 inhibitor in specifically
    killing malignant rhabdoid tumors (MRT) that are INI1-deficient, both in
    cell culture and in rodent xenograft models. This work demonstrates for
    the first time the effectiveness of an EZH2 inhibitor in a solid tumor
    indication.

Second Quarter 2013 Financial Results & Financial Guidance

  oCash Position Cash and cash equivalents as of June 30, 2013, were $148.7
    million, compared to $98.0 million at December 31, 2012. The cash increase
    was primarily driven by gross proceeds of $88.7 million from Epizyme's
    initial public offering. Cash and cash equivalents as of June 30, 2013 did
    not include the $6.0 million milestone earned in the Eisai collaboration
    in June, which was received in July.
  oRevenue Collaboration revenue was $14.8 million for the second quarter of
    2013 and $23.7 million for the six months ended June 30, 2013, compared to
    $15.3 million and $21.0 million for the comparable periods in 2012.
  oR&D Expenses Research and development expenses were $13.9 million for the
    second quarter of 2013 and $27.3 million for the six months ended June 30,
    2013, compared to $8.9 million and $18.1 million for the comparable
    periods in 2012. The increase was largely driven by the expansion of the
    Company's product platform and costs for the clinical studies of EPZ-5676
    and EPZ-6438.
  oG&A Expenses General and administrative expenses were $3.1 million for the
    second quarter of 2013 and $6.1 million for the six months ended June 30,
    2013, compared to $1.6 million and $3.5 million for the comparable periods
    in 2012. The increase was largely driven by incremental expenses to
    support public company operations as well as increased stock-based
    compensation expense and other costs to support the Company's growth.
  oNet (Loss) Income Net loss was $2.2 million for the second quarter of 2013
    and $9.7 million for the six months ended June 30, 2013, compared to net
    income of $4.9 million and net loss of $0.6 million for the comparable
    periods in 2012. The 2012 second quarter net income was largely driven by
    the revenue recognition of a portion of the $68.0 million upfront payment
    received from Celgene in April 2012.
  oEnd of Year Cash Guidance Epizyme expects that its cash and cash
    equivalents will be approximately $115 million as of December 31, 2013,
    which it believes will fund the Company until at least mid-2015. Full-year
    2013 net cash used in operating activities is expected to be approximately
    $65 million.

Upcoming Milestones

  oEPZ-5676 In the second half of 2013, Epizyme plans to complete the dose
    escalation stage of the Phase 1 study and initiate the expansion cohort,
    which will be limited to patients with MLL-r and which may provide an
    initial assessment of therapeutic effect.
  oEPZ-6438 In 2014, Epizyme plans to initiate the Phase 2 portion of the
    Phase 1/2 study of EPZ-6438, which will be limited to patients with point
    mutations in EZH2 and which may provide an initial assessment of
    therapeutic effect.

Conference Call Information

Epizyme will host a conference call and live audio webcast today at 4:30 p.m.
EDT to discuss the quarter and provide a corporate update. To participate in
the conference call, please dial 1-877-844-6886 (domestic) or 1-970-315-0315
(international) and refer to conference ID 17477005. The live webcast can be
accessed under "Events and Presentations" in the Investor Relations section of
the Company's website at www.epizyme.com.

The archived webcast will be available on the Company's website beginning
approximately two hours after the event.

About Epizyme, Inc.

Epizyme, Inc. is a clinical stage biopharmaceutical company creating
personalized therapeutics for patients with genetically defined cancers.
Epizyme has built a proprietary product platform that the company uses to
create small molecule inhibitors of a 96-member class of enzymes known as
histone methyltransferases, or HMTs. HMTs are part of the system of gene
regulation, referred to as epigenetics, that controls gene expression. Genetic
alterations can result in changes to the activity of HMTs, making them
oncogenic (cancer-causing). By focusing on the genetic drivers of cancers,
Epizyme's targeted science seeks to match the right medicines with the right
patients for a personalized approach to cancer treatment.

For more information, visit www.epizyme.com and connect with us on Twitter at
@EpizymeRx.

EPIZYME, INC.
CONSOLIDATED BALANCE SHEET DATA (UNAUDITED)
(Amounts in thousands)
                                         June 30,            December 31,
                                         2013                2012
Cash and cash equivalents                $              $     
                                         148,689            97,981
Total assets                             162,044             103,511
Deferred revenue                         56,937              69,445
Redeemable convertible preferred stock   -                   76,156
(Series A, B and C)
Stockholders' equity (deficit):          96,127              (51,126)



EPIZYME, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands except per share data)
                                Three Months Ended June  Six Months Ended June
                                30,                      30,
                                2013          2012       2013        2012
Collaboration revenue           $          $       $        $    
                                14,839       15,342    23,721     20,996
Operating expenses:
      Research and development  13,937        8,899      27,298      18,127
      General and               3,079         1,638      6,077       3,545
      administrative
Total operating expenses        17,016        10,537     33,375      21,672
(Loss) income from operations   (2,177)       4,805      (9,654)     (676)
Other (expense) income, net     (35)          51         (55)        64
Net (loss) income               $         $      $        $    
                                (2,212)       4,856      (9,709)     (612)
Less: accretion of redeemable
convertible preferred stock
      to redemption value       107           156        264         167
Less: income allocable to       -             4,354      -           -
participating securities
(Loss) income allocable to      (2,319)       346        (9,973)     (779)
common stockholders - basic
Undistributed income
re-allocated to common          -             236        -           -
stockholders
(Loss) income allocable to      $         $      $        $    
common stockholders - diluted   (2,319)       582     (9,973)     (779)
(Loss) earnings per share
allocable to common
stockholders:
      Basic                     $        $      $       $    
                                (0.25)        0.21     (1.82)      (0.48)
      Diluted                   $        $      $       $    
                                (0.25)        0.20     (1.82)      (0.48)
Weighted average shares
outstanding:
      Basic                    9,146         1,636      5,489       1,629
      Diluted                   9,146         2,913      5,489       1,629

Note: Common shares outstanding as of the end of the second quarter of 2013
were 28.4 million following the sale of 5.9 million shares of common stock,
including all additional shares sold to cover over-allotments, in the
Company's initial public offering and the resulting automatic conversion of
the Company's redeemable convertible preferred stock into 20.6 million shares
of common stock, compared to 1.6 million common shares as of the end of the
second quarter of 2012. The Company's weighted average shares outstanding for
the second quarter of 2013 were 9.1 million shares.

Cautionary Note on Forward-Looking Statements

Any statements in this press release about future expectations, plans and
prospects for the Company, including statements about the Company's strategy,
future operations, clinical development of the Company's therapeutic
candidates, expectations regarding the sufficiency of the Company's cash
balance to fund operating expenses and capital expenditures, milestone or
royalty payments from the Company's collaborators, the Company's anticipated
milestones and future expectations and plans and prospects for the Company and
other statements containing the words "anticipate," "believe," "estimate,"
"expect," "intend," "may," "plan," "predict," "project," "target,"
"potential," "will," "would," "could," "should," "continue," and similar
expressions, constitute forward-looking statements within the meaning of The
Private Securities Litigation Reform Act of 1995. Actual results may differ
materially from those indicated by such forward-looking statements as a result
of various important factors, including: the uncertainties inherent in the
initiation of future clinical trials, expectations of expanding ongoing
clinical trials, availability of data from ongoing clinical trials,
expectations for regulatory approvals, development progress of the Company's
companion diagnostics, availability of funding sufficient for the Company's
foreseeable and unforeseeable operating expenses and capital expenditure
requirements, other matters that could affect the availability or commercial
potential of the Company's therapeutic candidates or companion diagnostics and
other factors discussed in the "Risk Factors" section of the Company's
prospectus filed with the Securities and Exchange Commission pursuant to Rule
424(b)(4) on May 31, 2013. In addition, the forward-looking statements
included in this press release represent the Company's views as of the date
hereof. The Company anticipates that subsequent events and developments will
cause the Company's views to change. However, while the Company may elect to
update these forward-looking statements at some point in the future, the
Company specifically disclaims any obligation to do so. These forward-looking
statements should not be relied upon as representing the Company's views as of
any date subsequent to the date hereof.

SOURCE Epizyme, Inc.