Regulus lays off 60% of staff, halts development
- Regulus Therapeutics announced the latest in a string of setbacks on Friday, including cutting 60% of its workforce in a bid to save $20 million annually in a restructuring effort. The news sent shares down more than 50% to $0.36 a share Friday.
- The La Jolla, California-based biotech will also stop clinical activities for its RG-012 program, partnered with Sanofi Genzyme, to preserve its cash runway through mid-2019.
- The restructuring includes the "pausing" of its Phase 1 RGLS4326 program due to "unexpected observations" in a toxicity study in mice that's designed to support a Phase 2 proof-of-concept trial in Autosomal Dominant Polycystic Kidney Disease. Regulus previously planned to start the trial in mid-2019.
Over the last two years, challenges have driven Regulus' share price down below $1 apiece, well off the highs nearly $20 per share the company was trading at in late 2014.
Friday's news is the company's last ditch effort to conserve some cash. It had only $10 million in cash and equivalents as of March 31.
Beyond lay offs, the company has put its lead program, RG-012 in Alport syndrome, on hold while it tries to rejigger its partnership with Sanofi. The companies paired up in 2010 when Sanofi agreed to pay as much as $750 million for the multi-year, multi-target development collaboration. At the time, Sanofi paid $25 million upfront, plus a $10 million equity investment.
Regulus is likely hoping that the positive efficacy signals seen in early patients could give it some negotiating room.
The trigger for the restructuring appeared to come from the Phase 1 program of RGLS4326: Toxicity in the mouse study has put the whole program in jeopardy.
"The observations in the mouse chronic toxicity study were unexpected, given the favorable safety profile of RGLS4326 in previous non-GLP and GLP toxicity studies at the same or similar doses supporting the Investigational New Drug application (IND) and Phase 1 program," wrote the company in a statement.
Regulus has consulted the Food and Drug Administration and has planned a 27-week mouse chronic toxicity study to address the unexpected findings. A primate chronic toxicity study continues with no significant findings so far.
With all of its troubles, Regulus will shift its focus to its preclinical hepatitis B program, for which it expects to file an Investigational New Drug application in the second half of 2019.
Regulus will seek to partner its other preclinical programs in glioblastoma multiforme, non-alcoholic steatohepatitis and immunology.
In 2016, the FDA put Regulus' lead drug, a compound for hepatitis C, on clinical hold after two serious cases of jaundice. It was abandoned in 2017. At the same time, Regulus revealed that AstraZeneca pulled out of a Phase 2 NASH program that the pair had been working on.
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