Aligos Therapeutics' rapid retreat from hepatitis B is nearly complete. One year after dropping two assets in response to clinical data, the biotech has put another two hepatitis B programs on the back burner and laid off staff to stretch its cash runway out to the end of 2024.
San Francisco-based Aligos went public in October 2020 to fund an attempt to develop a functional cure for hepatitis B. At the time, the biotech was working on four programs, each of which attacked the virus from a different angle. Two programs fell in the first quarter of 2022 as lackluster efficacy evidence and a safety signal dampened enthusiasm for the candidates.
Now, Aligos, with a cash crunch on the horizon, has de-prioritized its two remaining hepatitis B programs. The biotech will continue to gather phase 1 data on the capsid assembly modulator-empty candidate and siRNA prospect for a while—and then review the next steps—but its priorities now lie elsewhere.
Having ended September with $142 million to its name, Aligos will use its remaining cash pile to push programs in nonalcoholic steatohepatitis (NASH) and COVID-19 past clinical milestones while continuing to collaborate with Merck & Co. on NASH oligonucleotide research.
The changes tie Aligos’ future to the THR-beta agonist ALG-055009 in NASH and the coronavirus protease inhibitor ALG-097558. Both candidates are closing in on the conclusion of early-stage trials. Aligos plans to submit a phase 2 filing in NASH and start a midphase COVID-19 trial by the end of the year. The biotech expects the changes to extend its cash runway from the first half of 2024 to the end of that year.
Aligos’ runway extension will cost some 10% of its employees their jobs. By combining the layoffs with “careful workforce management, including employee attrition and targeted hiring,” Aligos, in a statement published the day after a floundering Magenta Therapeutics moved to lay off 84% of its staff, said it has reduced its head count by 25% since the start of 2022.
The fall in staff level largely happened in recent months. Aligos ended 2021 with 93 full-time employees, suggesting that the subsequent 25% reduction has trimmed its team to around 70 people. At the end of September, the biotech still had 89 full-time employees. Most, 72, of Aligos’ employees worked in R&D. After shrinking its team, the biotech will consolidate its two San Francisco locations into its headquarters in the city. Sites in Belgium and China will remain in operation.
While Aligos is pulling back from hepatitis B, its past focus on the indication remains a live legal issue for the company. Eleven months ago, Johnson & Johnson sued Aligos and its co-founders in a lawsuit that accused the biotech of building its hepatitis B pipeline on stolen intellectual property. Aligos hit back with counterclaims and said J&J’s accusations are without merit.