As CEO goes, cash woes drive Sio to give Parkinson's program the heave-ho

Sio Gene Therapies is dumping its midphase Parkinson’s disease program to eke out its cash into 2023. Years after the biotech, then known as Axovant, had a high-profile failure in Alzheimer’s, it has decided to cull its current riskiest bet and focus on two other programs under the leadership of a new CEO.

In November, Sio said its $102 million would see it through to the fourth quarter of 2022. Since then, the stock has continued to slip, falling to just above $1 and leaving Sio with a diminished ability to raise cash from public markets. The share price is a far cry from the peak-Axovant hysteria, when the stock touched $200 before clinical data injected a brutal dose of reality into the situation. 

Axovant ultimately responded to the flop by pivoting to gene therapy and rebranding as Sio. The rebuilt pipeline featured two rare disease programs and one high-risk, high-reward bet on Parkinson’s. With the end of the cash runway fast approaching, Sio has decided it can no longer afford that risky bet.

Sio is returning the rights to the Parkinson’s lentiviral gene therapy program, AXO-Lenti-PD, to Oxford Biomedica. Axovant licensed the global rights to the candidate in 2018 for $30 million upfront. Oxford Biomedica plans to out-license the candidate, which has been given to six patients in a phase 2 trial, to a new partner “in due course.”

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Sio disclosed news of the action alongside details of the departure of its CEO Pavan Cheruvu, M.D., who told the company he planned to resign last week. Cheruvu set his departure date as Jan. 31 but is sticking around for two weeks after that as a nonexecutive employee to help with the transition. Sio isn’t paying Cheruvu any severance benefits and will consider internal and external candidates for the CEO role.

David Nassif, chief financial officer of Sio, is stepping up to the CEO post on an interim basis. Sio is upping Nassif’s annual base salary to $568,600, more than it paid Cheruvu in 2020, but, by removing one executive and the Parkinson’s trial from its expenses, has still extended its cash runway.

The biotech ended 2021 with around $82 million, a sum it expects to see it through to the second half of 2023. By then, Sio should have presented more clinical data on its GM1 gangliosidosis gene therapy and engaged with the FDA about the next steps for clinical development. Sio will also have advanced a trial of its gene therapy for Tay-Sachs and Sandhoff diseases.