Encoded Therapeutics is joining the ranks of biotechs pummeled by the whiplash of a difficult biotech market, laying off "close to 10%" of its team, according to Chief Business Officer David McNinch.
McNinch confirmed the layoffs in an emailed statement to Fierce Biotech on Tuesday, saying the decision came after a critical assessment of the company’s priorities. The personnel changes took place in early May, McNinch says.
“Through this process, we reduced some of our expected spend over the coming years and had a reduction of force of close to 10%,” he wrote. He said the company’s available capital is expected to support its operations into 2026, with the focus on producing clinical proof-of-concept for its lead asset ETX101, a treatment for Dravet syndrome.
Encoded unveiled in June 2019 with a $104 million series C round after being incubated by Illumina Accelerator and receiving seed funding from ARCH and Venrock. The series C round also included Menlo Ventures, RTW Investments and Alexandria Venture Investments. A little more than a year later, the company closed another gargantuan financing, tacking in $135 million from a GV-led series D.
Confirmation of the layoffs comes just one day after Encoded terminated a natural history study of developmental and epileptic encephalopathies, reporting in the clinical trial record that it “generated a robust data set that shows consistency in the seizure and non-seizure manifestations of SCN1A+ Dravet syndrome.” Launching the natural history study was a priority after raising the series D in 2020.
The other clinical priority was a phase 1 trial testing ETX101, which was first posted on clinicaltrials.gov in June 2022. The trial was slated to start in December 2022, but no update has been made since the trial record first appeared and the trial is not yet recruiting, according to the record. ETX101 was granted both orphan drug designation and rare pediatric disease designation.
Editor's note: This story was updated with further comment from David McNinch, who noted the personnel changes took place in early May.