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Shares of Epizyme, Inc. (EPZM - Snapshot Report) were up 75.6% a day after the company announced the achievement of the proof of concept (POC) milestone in the development program of its pipeline candidate EPZ-5676 in an ongoing phase I study.

Epizyme is developing the candidate for treating a rare form of acute leukemia characterized by a re-arranged MML gene (mixed lineage leukemia). The re-arrangement is caused by chromosomal translocation. We note that Epizyme is developing EPZ-5676 in collaboration with Celgene Corporation (CELG - Analyst Report) which holds the license for EPZ-5676 outside the U.S.

The achievement led to Epizyme earning a milestone payment of $25 million, triggered by objective responses in patients with translocations of the MLL gene (MLL-r). These patients are currently enrolled in the fourth dose cohort in the dose escalation stage of the ongoing phase I trial.

Epizyme expects to present data from this phase I study on EPZ-5676, in 2014 including the dose escalation stage that is fully enrolled and the adult MLL-r expansion stage which is currently enrolling patients.

We remind investors that EPZ-5676 enjoys orphan drug status in the U.S. since May 2013. Meanwhile, the European Medicines Agency's Committee for Orphan Medicinal Products recommended orphan drug designation for EPZ-5676 to the European Commission in Dec 2013.

In addition, Epizyme earned a $4 million milestone payment for one of the three histone methyltransferase (HMT) targets, which are included in the company's collaboration agreement with GlaxoSmithKline (GSK - Analyst Report).

The total milestone payments from  Celgene and GlaxoSmithKline is expected to boost the estimated 2013 end cash and account receivables balance to approximately $145 million, up from the previous guidance of $115 million.

Going forward, Epizyme expects to have as many as five clinical POC programs in 2014. These include the ongoing adult MLL-r expansion stage, MLL-r in pediatric patients, and adult MLL-PTD patients on EPZ-5676. Additionally, the POC program includes indications like adult non-Hodgkin lymphoma patients and pediatric and young adult patients with synovial sarcomas on candidate EPZ-6438.

Epizyme, a clinical stage biopharmaceutical company, carries a Zacks Rank #3 (Hold). At current levels, Affymetrix Inc. (AFFX - Analyst Report) looks attractive with a Zacks Rank #1 (Strong Buy).

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