Gemphire cuts 33% of staff, including CFO, CMO

Things have gone from bad to worse for Gemphire. Last month, the biotech cut a phase 2 fatty liver trial because some patients' disease got worse, and now it is cutting staff in a bid to cut costs and save cash. 

Gemphire’s board of directors approved the cuts after the FDA said it would need more preclinical data before it could schedule an end of phase 2 meeting for its only drug, gemcabene, in dyslipidemia indications, the company said in a statement Monday. The FDA placed a partial clinical hold on gemcabene back in 2004, which allows the company to conduct clinical trials lasting up to six months. It also required Gemphire to carry out two-year rat and mouse studies around gemcabene’s carcinogenicity, or its ability to produce cancer cells from normal cells. Gemphire submitted data from that two-year study to the agency earlier this year. While the drug caused tumors to form in rodents, the company believes that this is “likely rodent-specific.” 

“Based on historical nonclinical and clinical experience on these type of compounds, we believe rodents share little apparent relevance for human risk assessment,” the company said at the time. 

However, the FDA responded with a request for even more data, including a 13-week study in mice. Gemphire said it planned to complete the additional studies and send the data over in the second quarter of 2019. 

"The workforce reduction is a necessary action to conserve capital. We remain confident in the potential value of gemcabene as a breakthrough therapy for dyslipidemia and are committed to working with the FDA to complete the necessary steps to lift the partial clinical hold,” said Gemphire CEO Steven Gullans, Ph.D., in the statement

The Livonia, Michigan-based company laid off five employees last week, about one-third of its workforce. The cuts include Jeffrey Mathieson, its chief financial officer, and Lee Golden, the chief medical officer. 

Gemphire’s programs in nonalcoholic fatty liver disease (NAFLD) and familial partial lipodystrophy (FPL) are not affected by the clinical hold. But it hasn’t been smooth sailing on those fronts, either. In early August, the company halted a phase 2a study in children with NAFLD because some patients’ disease got worse. The primary endpoint was a change in serum alanine transaminase (ALT), an enzyme biomarker of liver function, after 12 weeks of treatment, while its secondary endpoints included a change in hepatic steatosis, the buildup of fat in the liver. 

The first three patients that completed 12 weeks of treatment had an increase in liver fat content, as well as elevated ALT levels. 

Gemphire licensed gemcabene from Pfizer in 2011. Pfizer had the right to cancel the deal if Gemphire did not “adequately” commercialize the drug by April 2021. The pair recently reworked the deal, which, among other things, extends the deadline of gemcabene’s first sale to April 2024.