- PTC Therapeutics on Tuesday announced a major restructuring as it attempts to preserve cash following the failure of an experimental drug for Friedreich ataxia in a Phase 3 trial.
- The New Jersey-based biotech also said Chief Financial Officer Emily Hill “has been relieved of her responsibilities” and will be leaving the company. In a separate regulatory filing, PTC said the dismissal was “without cause” under the terms of Hill’s contract and she will be entitled to severance benefits.
- As part of the restructuring, PTC is ending all of its preclinical and early research programs in gene therapy and is laying off about 8% of its workforce, mostly in the U.S. The company had 1,402 full-time employees at the end of 2022.
The turmoil at the rare disease specialist comes two months after the retirement of its founder, Stuart Peltz, in March. Peltz had served as CEO for all of the company’s 25 years in existence and oversaw growth that prompted executives to predict revenue of as much as $1 billion this year.
Still — even with a number of marketed drugs — research costs and general expenses have kept PTC unprofitable. In the first quarter, the company reported a net loss of $139 million, or $1.88 a share, on net product revenue of $188 million.
The restructuring will help lower the rest of 2023 operating expenses by about 15%, PTC said. In some cases, the company will attempt to seek out new developers for discontinued gene therapies, which include medicines for Friedreich ataxia, Angelman syndrome and other rare central nervous system and eye disorders.
PTC said it will continue developing and marketing Upstaza, a gene therapy for a rare neurological disease. The company won approval for the treatment in Europe last year and plans to submit it for U.S. approval, with a filing planned as early as the third quarter of this year.
The shift in priorities will allow PTC to focus on experimental therapies most likely to offer “a significant return on investment,” the company said Tuesday. Just days ago, PTC was riding high after a drug for a rare genetic disorder known as phenylketonuria, or PKU, succeeded in a late-stage clinical trial.
The latest study results come from a trial of PTC’s vatiquinone drug in Friedreich ataxia, a neurodegenerative disorder. Researchers found the treatment didn’t offer a significant improvement in a neurological ratings scale known as mFARS compared with a placebo. Still, the company highlighted benefits in certain areas and said it would discuss a path forward with regulators.
"Given the signals of clinical benefit, vatiquinone's well-established safety profile in children, and the unmet medical need for pediatric patients with FA, we look forward to discussing a potential path to registration with regulatory authorities,” said CEO Matthew Klein in a statement.
Shares in PTC fell by nearly one-quarter in value Wednesday.