Coherus Oncology is once again laying off 30% of its workforce as the biopharma narrows the focus of its investigational combo treatment to esophageal cancer.
Last month, the California company presented a range of phase 1b data for a combination of its CCR8-targeting antibody, called tagmokitug, with its approved PD-1 blocker Loqtorzi, which is also known as toripalimab. Those results showed “encouraging anti-tumor activity across multiple solid tumors,” including esophageal cancer, gastrointestinal cancer and head and neck squamous cell carcinoma—tumors with few approved options and traditionally low long term survival rates.
At the time, the company singled out results for front-line esophageal squamous cell carcinoma (ESCC) patients, where the tagmokitug-toripalimab combo, along with chemotherapy, demonstrated a confirmed overall response rate (ORR) of 75% irrespective of PD-L1 status.
Tagmokitug is a highly selective, cytolytic anti-CCR8 antibody designed to specifically deplete CCR8-positive regulatory T cells (Tregs) in the tumor microenvironment in order to overcome immune resistance and enhance antitumor immune responses.
In its third-quarter earnings results on Monday, Coherus CMO Rosh Dias, M.D., said that the “compelling anti-tumor activity” observed in both ESCC and esophageal adenocarcinoma cohorts “suggests that Tregs are a critical driver of resistance.”
“Importantly, we saw tagmokitug enhance PD-1’s activity, demonstrate activity in PD-L1 negative tumors, and rescue PD-1 refractory patients,” Dias noted.
As a result, Coherus said it will deprioritize development of the combo treatment in the wider variety of cancers in order to focus specifically on esophageal indications. This “right sizing” of the strategy requires a reduction in headcount of around 30% as a result of “aligning [the] organization with forward-focused needs,” Coherus explained.
“The financial benefits of right-sizing the organization and reducing the scope of our forward-focused efforts provide substantial and durable benefits to our operating model,” Chief Financial Officer Bryan McMichael said in the earnings release.
“These benefits will be realized over the next two quarters, lowering our core cash burn by $6 million to $7 million quarterly, which in turn lowers the quarterly Loqtorzi revenues required to cover core burn to $25 million to $30 million, down from $30 million to $35 million, as previously guided.”
Loqtorzi is the only FDA-approved treatment for recurrent, locally advanced or metastatic nasopharyngeal carcinoma. Third-quarter revenue for the drug rose 25% year-over-year to $14 million. Coherus ended September with $83.6 million in the bank.
“The strategic prioritization of esophageal cancer as our best-in-disease focus for tagmokitug … provides an ideal opportunity to right-size the organization and deliver financial benefits that flow directly from this prioritization,” CEO Denny Lanfear explained in the release.
“Over the next four or five quarters, we will remain intensely focused on growing Loqtorzi market share in relation to chemo-only, an inferior therapeutic approach, and off-label IO, which has not demonstrated standard-of-care level of benefit for patients living with nasopharyngeal carcinoma,” Lanfear added. “We believe this approach can provide a path to financial self-sufficiency.”
The biopharma’s R&D plans also include kicking off a phase 1b trial later this year evaluating tagmokitug in combination with Johnson & Johnson's T-cell engaging bispecific antibody pasritamig in metastatic castration-resistant prostate cancer, as well as continuing a phase 2 trial of Coherus' IL-27 antagonistic antibody casdozokitug in first-line unresectable hepatocellular carcinoma.
Yesterday’s decision wasn’t the first time that Coherus has moved to shrink its headcount by around 30%. Last year, the company laid off a similar proportion of employees following the sale of its Neulasta biosimilar to Accord BioPharma.
It meant Coherus entered 2026 with 147 full-time and part-time employees, a drop of 81 employees over the previous year.
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