Despite a string of recent good news on the clinical front, Salarius Pharmaceuticals is halving its workforce and bracing for the potential end of the company as remaining resources are eaten away.
As recently as May, Salarius was celebrating getting the Ewing sarcoma drug seclidemstat back into the clinic after an FDA hold—triggered by a patient death—was lifted. It should have been a relief for the biotech, which had reported a 60% disease control rate for the LSD1 inhibitor in December for the phase 1/2 trial.
The end of last year had also seen seclidemstat demonstrate a 50% overall response rate among eight myelodysplastic syndrome and chronic myelomonocytic leukemia patients when used in combination with Bristol Myers Squibb’s Vidaza.
Meanwhile, the company’s other program, a molecular glue called SP-3164, was cleared by the FDA just last month to enter the clinic for non-Hodgkin lymphoma. But it sounds like this spur of progress may have added to the company's woes.
“The second quarter and recent weeks were highlighted by significant advancements in both of our development programs, but after a review of each program’s future funding needs and the current financial markets, the board of directors has made the difficult decision to limit further drug development while we explore strategic alternatives for both Salarius and continued development of our drugs,” CEO David Arthur said in a postmarket release Tuesday.
Those strategic alternatives cover the usual range of potential mergers, acquisitions or asset sales that troubled biotechs turn to when the chips are down. But the company warned that if it is “unable to complete a transaction, it may be necessary to seek other alternatives for restructuring and resolving its liabilities, including an orderly wind-down of operations.”
Regardless of the eventual outcome, it’s already the end of the road for the majority of Salarius’ employees. “In connection with the evaluation of strategic alternatives and in order to extend its resources, Salarius is implementing a cost-savings plan that includes a reduction in workforce by over 50% of its positions,” the company explained.
The remaining staff will mainly focus on “limited drug development activities,” including working with the FDA on the trial registration requirements for seclidemstat’s Ewing sarcoma program as well as “supporting the exploration of strategic alternatives.”
A glance at the company’s finances gives a sense of why management has arrived at the decision. Salarius ended March with $9.2 million in cash and equivalents, down on the $12 million it entered the year with. That money was due to run out as soon as the third quarter of this year, although a $6 million private placement of shares in May should have helped keep the lights on for a while longer.