Boston-based Epirus Biopharmaceuticals ($EPRS) initially set out to carve a unique spot for itself in the biosimilars business, a small outfit that believed it could find a leading role in emerging markets around the world. Backed by a group of high-profile investors, it set its sights on Remicade.
And marched straight into a crisis.
Today the company announced that its founding CEO, Amit Munshi, has resigned. Forty percent of the staff--there were 73 employees in March--has been let go, and a board member from 5AM Ventures is stepping in to run Epirus, which has just enough money to get through June. That lead program? It’s been suspended, as Epirus attempts to retool its pipeline around biosimilars for rare diseases.
Epirus shares cratered on the litany of setbacks and warnings, dropping 54% in morning trading.
Close observers of the company, though, may not have been surprised. Epirus' 10-K included a "going concern" warning about the looming cash crunch.
The biosimilars business is dominated by major players like Samsung and Novartis ($NVS), which have been racking up the first in what is expected to be a wave of new approvals for the U.S. market. Europe took the lead, though, laying out regulations on development years ago. Even though the R&D process for biosimilars is easier than that for novel drugs, they still face major Phase III hurdles if they expect to ever make it in the world's top markets.
Scott Rocklage, managing partner at 5AM Ventures and founding CEO at Cubist, will now be charged with picking up the pieces at Epirus. For now, that means putting BOW015 on the back burner while looking for partnerships, sales or some other way to gin cash quickly. The company plans to use its remaining resources to focus on knockoffs of Soliris and Actemra.
A little more than two years ago, Epirus raised $36 million from a syndicate that was led by Livzon Mabpharm. Other investors included Adage Capital, Greenwoods Investment, Gibralt US, Monashee Capital Partners, and an investment affiliate of Mousse Partners, as well as existing investors TPG Biotech, Montreux Equity Partners and 5AM Ventures.
- here's the release