Codiak files for bankruptcy after exosome-focused biotech unable to satisfy 'financial needs'

Another biotech bites the dust. This time it’s Codiak BioSciences, whose attempts to deliver exosome-based therapeutics have reached the end of the road.

Codiak has voluntarily filed for Chapter 11 bankruptcy and will attempt to find a buyer for the whole business or its core assets “as soon as reasonably practicable,” it announced this morning. The biotech has already appointed Province’s Paul Huygens to oversee the restructuring process with an eye on securing the best sale price.

“The board and management team have thoroughly assessed all of our strategic options and believe that this structured process represents the best possible solution for Codiak, taking into account our financial needs and the stage of our clinical and research programs,” said CEO Douglas Williams, Ph.D., in a release.

Most of the board’s executive management team will be leaving the business at the end of next week, with only Chief Technology Officer Konstantin Konstantinov, Ph.D., listed as staying on for the time being.

The Cambridge, Massachusetts-based biotech's platform leverages engineered exosomes, seen as the cell’s garbage removal system, which carry payloads like proteins or RNAs from one cell to another. Codiak’s pan-betacoronavirus vaccine construct, dubbed exoVACC, uses this system to develop antigens and adjuvants to illicit immune responses.

The first cracks appeared back in August, when Codiak laid off over a third of its staff—leaving it with 53 full-time employees—and paused plans to launch phase 2 studies for two candidates. One of these was exoSTING, an engineered exosome designed to treat multiple solid tumors, while the other was exoIL-12, aimed at early-stage cutaneous T-cell lymphoma.

Instead, the company focused its resources on exoASO-STAT6, its phase 1 drug candidate engineered to selectively deliver antisense oligonucleotides to disrupt STAT6 signaling in tumor-associated macrophages and induce an anti-tumor immune response. Preclinical studies showed single-agent anti-tumor activity in models of aggressive hepatocellular carcinoma.

The company also kept its preclinical engEx-AAV discovery program, a strategy that aimed to enhance AAV gene therapy. Meanwhile, in vivo proof-of-concept data showed that Codiak's exoVACC pan beta coronavirus vaccine elicited broad protective immunity against variants of SARS-CoV-2 and other coronaviruses.

The company still had $51.8 million in cash, equivalents and securities in the bank as of the end of September, but with a $19.3 million loss for the quarter, it would have needed to secure significant funding to plug the gap and continue as a going concern.