- Frequency Therapeutics on Monday said an experimental drug it’s developing for a form of hearing loss failed to meet its goal in a mid-stage study. As a result, the company is stopping work on the program and on another hearing loss drug candidate that began clinical testing in December.
- The pipeline cuts will be accompanied by a corporate restructuring that will involve layoffs for approximately 55% of Frequency’s workforce.
- With the restructuring, Frequency becomes at least the 23rd biotechnology company to turn to layoffs so far this year, indicating the sector is still feeling the effects of a market downturn that weighed on young drug companies last year.
A spinout of the Massachusetts Institute of Technology, Frequency sought to develop treatments for hearing loss by regenerating lost hair cells in the inner ear, rather than turning to hearing aids or implants.
Both its lead drug FX-322 and FX-345, its follow-on candidate, were aimed at sensorineural hearing loss, which results from damage to sensory hair cells and is estimated to impact millions of individuals in the U.S.
The company raised $228 million privately and added another $84 million in an initial public offering in 2018 to fund its research. But shares have lost nearly all of their value since. And with the negative results from a Phase 2b trial of FX-322 Monday, Frequency is ending development of both candidates.
“This was a rigorous and well-designed study that provided us a clear outcome, though not the outcome we wanted,” said Chris Loose, Frequency’s chief scientific officer, in a company statement. “We hope the learnings from our studies will benefit the field and ultimately support the successful development of future treatments for hearing loss.”
The Phase 2b trial enrolled 142 people with sensorineural hearing loss and tested FX-322 against placebo. Treatment failed to significantly improve speech perception by day 90 of the trial, and there were no measurable gains made on any of the study’s secondary goals, Frequency said.
As with other biotechs that have faced clinical setbacks, Frequency has been forced to cut costs in response.
The layoffs disclosed Monday are the second time in less than a year that the biotech has trimmed staff. In April 2022, the company laid off 30% of its workforce prior to beginning the Phase 2b trial. One month later, Frequency said the move would give it enough cash to survive into 2024.
With the new layoffs Monday, Frequency now expects its cash runway to last into 2025.
The company will be facing its future with new leadership, too. On Friday, Frequency appointed Loose, a co-founder as well as its top scientist, as interim chief executive officer while CEO David Lucchino goes on medical leave following hospitalization for bacterial meningitis. And, as part of the company’s restructuring, Frequency’s chief development officer, Carl LeBel, will be stepping down March 31.
Lucchino is expected to resume CEO responsibilities once he recovers, according to a regulatory filing.
Frequency now plans to turn its attention to developing a treatment for multiple sclerosis. Clinical testing is expected to begin in the first half of next year.