Cyclerion Therapeutics, which spun out of Ironwood Pharma earlier this year, will lay off 30 of its 135 employees after one of its lead programs fell short in phase 2 studies in heart failure and diabetic kidney disease. The company’s stock plummeted more than 75% when trading opened on Wednesday.
The layoffs, disclosed in an SEC filing Tuesday and first reported by the Boston Business Journal on Wednesday, come only seven months after the Cyclerion spun out of Ironwood to work on soluble guanylate cyclase (sGC) stimulators for a range of rare and life-threatening disorders, such as sickle cell disease and liver and lung disease, as well as heart failure and diabetic nephropathy.
Cyclerion announced that one of its most advanced candidates, praliciguat, did not improve exercise capacity in patients with heart failure with preserved ejection fraction (HFpEF). Unlike another type of heart failure, in which the organ is too weak to pump blood, HFpEF refers to a condition in which the heart pumps normally, but its tissue is too stiff to fill properly. The study pitted praliciguat against placebo in 196 patients aged 45 or older. The company is axing the heart failure program for praliciguat.
The drug fared a little better in the diabetic nephropathy study, which tested two doses of praliciguat against placebo in 156 patients. It lowered the amount of albuminuria—or the albumin in patients’ urine, a sign of kidney disease—but that reduction did not meet statistical significance, so the study missed its primary endpoint.
However, Cyclerion isn’t chalking the study up as a loss. It’s carrying on with the program thanks to “positive trends” in the study’s secondary endpoints, such as blood pressure and cholesterol levels.
“I am encouraged by the estimated reduction in albuminuria of 15% or more, compared with placebo, on top of current standard of care. This molecule modifies pathways that are complementary to those targeted by usual care, and it warrants further investigation as a potential treatment for patients with diabetic kidney disease,” said Ian de Boer, M.D., a professor of nephrology and epidemiology and associate director of the Kidney Research Institute at the University of Washington, in a statement.
It’s not going it alone though—Cyclerion plans to license the drug out for late-stage development and commercialization.
“We believe praliciguat has the potential to be a first-in-category treatment for patients with diabetic nephropathy,” said Cycelrion Chief Scientific Officer Mark Currie, Ph.D., in the statement. “We look forward to sharing the data with prospective partners.”
With layoffs coming and the heart failure program out the window, Cyclerion will focus on onlinciguat, its drug for sickle cell disease, as well as its earlier-stage programs in disorders of the central nervous system. It will report phase 2 data for olinciguat in mid-2020 and phase 1 data for IW-6463m an sGC stimulator of the central nervous system by the end of the year.
The company plans to cut its monthly cash burn by 25%. As of the end of September, Cyclerion had about $125 million in the bank, which it expects to carry it through the first quarter of 2021, it said in the statement.