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Solid Bio starts to break up as the ax swings down on one-third of workers, CMO

Nasdaq
Nasdaq-listed biotech Solid saw it shares hit again this morning on news of layoffs. (Nasdaq)

Amid clinical holds, manufacturing concerns, safety issues and downsized IPOs, Solid Biosciences is bloodletting from its staffers.

First, the history: Toward the end of last year, a new clinical hold following serious adverse events formed just part of a long line of setbacks for Solid Bio and the development of its gene therapy for Duchenne muscular dystrophy.

In 2018, the company resolved partial and full clinical holds for its phase 1/2 study of SGT-001, its single-dose, AAV-mediated microdystrophin therapy, after addressing safety and manufacturing concerns.

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This looked like a positive, but then that trial was put on hold again in November after the sixth and latest patient saw decreases in red blood cell and platelet counts, activation of the complement immune system response, acute kidney injury and cardio-pulmonary insufficiency. This saw its shares take a nosedive.

In January 2018, Solid Bio revealed the trial’s first partial clinical hold, remarkably, at the same time as the company’s IPO and debut on the Nasdaq. It moved forward with an inevitable cut-price offering for an upsized stake after receiving heavy criticism for not disclosing the notice earlier in its December prospectus or subsequent filings.

Things then got worse, as the partial hold was upgraded to a full clinical hold later that spring over manufacturing concerns related to higher doses. The company was able to resume enrollment by mid-June 2018 after amending its study protocol.

But the company’s stock took another hit this past February when SGT-001 demonstrated low levels of microdystrophin expression in an analysis of the trial’s lower dose.

In December of last year, the company reported biomarker data from two patients it said “provide evidence that SGT-001 is biologically active with differentiated properties,” which it believes “warrants further evaluation.”

So, to the present: In a statement this morning, and not really a surprise given the above, the biotech announced swingeing cuts: “Going forward, the company will focus on conducting its analyses of SGT-001 to determine how to address the clinical hold and resume dosing.

The activities supporting the company’s other research and development programs will be curtailed as Solid establishes a path forward for SGT-001. As part of the organizational changes, the company will reduce its work force by approximately one third. In conjunction, Chief Operating Officer Alvaro Amorrortu, M.B.A. and Chief Medical Officer Jorge Quiroz, M.D., M.B.A. will depart the company but will continue as advisors to Solid.

The biotech hopes these cuts will save cash and give it enough to keep going until next year.

“We believe SGT-001 holds great potential for the treatment of Duchenne, and in order to effectively evaluate its potential for patients, we made some difficult choices to focus our resources and help extend our cash runway,” said Ilan Ganot, CEO, president and co-founder of Solid Biosciences.

“We are grateful for the efforts and contributions of our employees who have worked tirelessly to advance our mission to improve the lives of patients with Duchenne. We are committed to supporting all employees during this transition.”

Shares in the company were down 17% premarket on the news this morning.

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