Esperion gets out the budget ax, chopping 170 staffers as its big drug launch sputters
Esperion’s executive team spent years insisting that they had found the sweet spot in the market for their cholesterol drug. But that strategy has soured badly, and after struggling to sell its heart disease pill for more than a year, the biotech says it will cut about 40% of its staff over the next few weeks.
The layoffs will take place across the board, from sales and marketing to R&D, CEO Sheldon Koenig told Endpoints News on Monday. While the chief executive declined to elaborate on how many employees will be affected, an SEC filing stated that approximately 170 staffers are on the chopping block.
The reductions, which will be complete by the end of the month, are expected to save the company up to $80 million going into 2022, Koenig said. Esperion’s stock $ESPR dipped about 4.7% upon the news, with shares pricing at $8.71 apiece. Shares have fallen more than 74% over the last year.
Nexletol, Esperion’s “goldilocks” cholesterol therapy also known as bempedoic acid, was approved back in early 2020 as an oral option that’s better than decades-old statins, but not as effective — or as expensive — as injectable PCSK9 therapies. A week later, the FDA approved Nexlizet, a combination of bempedoic acid and ezetimibe (another cholesterol-lowering medicine).
Esperion thought that with a smart pricing strategy — Nexletol costs just over $11 per day — it could beat out the pricey PCSK9s Repatha and Praluent.
But launching a heart drug amid the pandemic proved to be a challenge. Patients were seeing their doctors less often, sales forces couldn’t travel, and even if they could, physicians’ offices weren’t necessarily open to reps. Esperion pocketed just $12.1 million last year on a drug they always believed would be a blockbuster.
In April, Esperion turned to Daiichi Sankyo, the Japanese pharma that was already commercializing Nexletol in Europe and Japan. Esperion struck a deal with Daiichi to market the drug in other regions in exchange for $30 million cash, tiered royalties and $175 million in milestones.
“It definitely was probably the hardest time to ever launch products, right in the middle of Covid, which was March of 2020,” Koenig said.
Koenig took the helm in May, shortly after longtime former CEO Tim Mayleben abandoned his post. At the time, the company’s stock had been trading for less than half of what it was when Nexletol was approved in February.
The chief executive says the company has seen a bit of a boost in the last couple quarters, with demand rising 30% between first and second quarter this year, and 10% between second and third.
The company’s currently working on a Phase III trial dubbed CLEAR Outcomes in cardiovascular patients who have statin intolerance and elevated LDL-C, or “bad” cholesterol levels. Topline results from that study are coming in early 2023, Koenig said.
“We still believe that we can continue to have consistent growth between now and when the CLEAR Outcomes study reports out,” he added.