Less than 2 weeks after failure-induced stock shock, VBL Therapeutics lays off staff

When VBL announced on July 20 that its viral therapy to treat cancer flunked a phase 3 trial, investors sprinted towards the exit, cratering the company’s already-low share price below 50 cents. 

It was also foreboding of an expected contraction, one that VBL conceded to Tuesday, announcing that 35% of staff would be laid off, or roughly 14 employees. In addition, three of the company’s board members—Ron Cohen, Bennett Shapiro and Alison Finger—have resigned.

While the moves were made to save cash, finances remain tight. The company says the remaining capital can fund operations for at least a year. VBL noted that severance payments would likely cost the company $600,000 in the third quarter. 

The late-July results that sent the company spinning left no room for ambiguity; ofra-vec, or VB-111 didn’t improve progression-free survival or overall survival among patients with platinum-resistant ovarian cancer. As a result, the company ended the trial and said it would “review the data” from the other phase 2 trials of the med in patients with metastatic colorectal cancer and recurrent glioblastoma multiforme. 

But Fierce Biotech has learned those two programs are investigator-initiated and that further continuation needs to be discussed with the company. The glioblastoma program is sponsored by the Dana-Farber Cancer Institute in collaboration with other U.S. medical centers while the colorectal cancer program is in collaboration with the National Cancer Institute. Both remain listed in the company’s pipeline, in addition to a pre-clinical asset, VB-601, for anti-inflammatory disease that was slated to enter the clinic later this year. The company previously said in its annual report that preliminary data from the phase 2 trials was expected sometime in 2022. 

The downsizing throws into question other plans the company had reported earlier in the year, namely the intention to bring on an additional manufacturing plant to support the manufacturing of ofra-vec. VBL also said it would advance ofra-vec in “additional cancer indications” although those have not materialized. 

Representatives of VBL did not return a request for comment as of publication.