If anyone needed a reminder of the toll the bear market continues to take on biotech, the wave of layoffs announced by companies postmarket yesterday should leave them in no doubt. Adamis Pharmaceuticals, Harpoon Therapeutics, Neoleukin Therapeutics and Tricida all outlined plans to lay off staff in response to financial headaches and stuttering drug development pipelines.
Tricida is making the deepest cuts, setting out a plan to reduce its head count by around 57% after the failure of its chronic kidney disease clinical trial spurred a search for strategic alternatives. The biotech ended last year with 57 full-time employees, 32 of whom worked in R&D, regulatory affairs, clinical operations and technical operations. Tricida expects the layoffs to cost it $2 million.
T-cell engager biotech Harpoon is undertaking a similarly major restructuring. After deciding to narrow its focus, the biotech outlined plans to reduce its workforce by 45%, with R&D bearing the brunt of the cuts. The remaining staff will work on Harpoon’s collaborations and three clinical programs that target BCMA, DLL3 and EpCAM.
Harpoon is seeking to partner another candidate, the MSLN-targeted, trispecific, T-cell–activating protein HPN536, “based on corporate priorities” after completing dose escalation. Of the remaining programs, the DLL3-targeted HPN328 has hit turbulence, with Harpoon pausing enrollment while it works with the FDA to mitigate risks that led to a patient’s death. The biotech expects to resume enrollment this year.
At Neoleukin, the decision to reduce head count by 40% follows the end of NL-201 development. The biotech took the cytokine mimetic into phase 1 but, based on a preliminary review of the results and “recent developments in the field of IL-2 therapeutics,” has opted against forging further into the clinic. The discontinuation is part of a spate of pipeline cuts by biotechs.
Optimism for IL-2 took a hit in the wake of the failure of Bristol Myers Squibb and Nektar Therapeutics’ bempegaldesleukin. Sanofi responded by rethinking the development plan for its IL-2 candidate, taking a 1.6 billion euro ($1.7 billion) charge in the process, and the fallout has now extended to Neoleukin.
Meanwhile, Adamis said it was considering employee head count reductions last month in a push to save costs while it looks into strategic alternatives. The San Diego-based drugmaker, which began reviewing its options after stopping a phase 2/3 COVID-19 trial, confirmed late Monday that it had since implemented “significant expense reduction measures including employee head count reductions” and a pause on all product development programs.
The layoffs didn't stop today, either, with London-based Freeline Therapeutics announcing a raft of changes including reducing its U.K. and U.S. head count by 30 and selling its German chemistry, manufacturing and control subsidiary to Ascend for $25 million. The changes will leave Freeline with 100 staff, who will be focused on the company's FLT201 candidate for Gaucher disease and FLT190 for Fabry disease, with investment in its hemophilia B prospect FLT180a while it remains unpartnered.
"The clinical data to date support FLT180a’s potential to be an important treatment option for patients with hemophilia B, if approved, and efforts to seek a partner to potentially bring FLT180a into phase 3 development are ongoing," the company added in an earnings release.