- Following a monthslong business review, Sio Gene Therapies revealed Thursday plans to shut down the company and liquidate its assets.
- The plan, put forward by the company’s board of directors, will need to win shareholder approval at a meeting slated to take place in the first quarter. If approved, the company will dissolve and delist its shares from the Nasdaq stock exchange.
- Previously known as Axovant, Sio sought to adjust to a market downturn that hit biotechnology companies hard this year. But after exhausting other options, the board concluded that ending operations would be in the best interest of its shareholders.
While many biotechs have had to cut costs this year, gene therapy developers have also faced questions over their treatments’ potential and the expected high costs of manufacturing and development. Early on in 2022, a number of them, including Sio, turned to layoffs and pipeline restructurings.
In April, Sio said it would discontinue its licensing agreements for two therapies targeting metabolic diseases. As a result, the company made a “significant” reduction to its headcount to help save cash and began a review of its business options.
“The board of directors and management, together with its external advisors, devoted substantial time and effort in identifying and pursuing opportunities to enhance shareholder value,” said Sio Gene Therapies CEO David Nassif, in a statement. “[H]owever, that process did not yield a potential transaction which the board viewed as reasonably likely to provide greater realizable value to its shareholders than the complete dissolution and liquidation of the company."
Sio previously hit several setbacks in the years since its formation in 2014. Then called Axovant, the company went public in 2015, raising $315 million. But an Alzheimer’s drug the company had licensed from GSK failed a late-stage study in 2017, prompting a research pivot.
The company rebranded as Axovant Gene Therapies in 2019 and spun out its small molecule research into a company called Arvelle Therapeutics.
Shares in the company sank again in 2020 after it ran into manufacturing issues for an experimental Parkinson’s drug. Soon after it changed its name again to Sio.
As of September 30, Sio had $53.7 million in assets, nearly $50 million of which was in cash and cash equivalents. It listed $4.8 million in liabilities then.
The company plans to establish a reserve as part of its liquidation plan to pay down expenses and liabilities. Any funds left over would be distributed to shareholders.