Finch Therapeutics’ nest is getting a bit smaller. Some 20% of the company's workforce is being let go amid a restructuring spurred by an FDA clinical hold and the pausing of a chronic hepatitis B program.
The company announced the layoffs in a regulatory filing Tuesday. The cuts, approved by the board on April 14, will impact 37 full-time employees.
The FDA in March placed a clinical hold on a phase 3 clinical trial for CP101, a donor-derived microbiome drug for Clostridioides difficile, as well as a partial hold on its new drug application. At issue is the way that Finch screens donors for COVID-19 infections. The company paused enrollment in the late-stage trial, dubbed PRISM4, due to the hold.
The company also paused its chronic hepatitis B program in early April, pulling out of a planned early-stage clinical trial.
And now the layoffs. Finch said the restructuring will allow it to direct financial resources at the C. diff and autism spectrum disorder programs. The changes will mean $1.1 million in costs for Finch due to severance payments and other expenses. The company said the restructuring will be substantially completed by the end of the second quarter, which is when the charges will be incurred.
Finch provided a brief update on the clinical hold, saying that the company had provided a complete response to the agency and is now awaiting feedback.
To read more about layoffs across the biotech industry, check out Fierce Biotech's Layoff Tracker.