Aquinox discards lead drug, chops half of its staff in wake of PhIII disaster
When Aquinox conceded utter failure on its Phase III trial two weeks ago, execs were clear that there was nothing left to salvage. They are now concluding that more than half of the staff will have to go with the drug program.
The restructuring claims 30 employees, accounting for around 53% of Aquinox’s workforce. The Vancouver-based biotech will also close its office in San Bruno, CA while it searches for a drug candidate — most likely a SHIP1 activator — to replace rosiptor.
Aquinox expects to spend $2.5 million in one-time termination severance payments and other costs related to employees and its San Bruno office, according to its SEC filing. That will significantly reduce their burn rate, though they do still have $90 million to $100 million in the bank, said CEO David Main.
“The goal is to put that money back to work to create value as soon as possible,” he told me.
Other than plucking something from their own early-stage pipeline, mergers and buyouts (as well as product acquisitions) are also on the table.
What remains uncertain after my chat with Main is the fate of the Asian licensing deal with Japan’s Astellas, which paid $25 million for development and commercialization rights to rosiptor in the region in May. That was when the drug was still touted as a first-in-class treatment, with a 433-patient Phase III trial for interstitial cystitis/bladder pain syndrome and another mid-stage study in chronic prostatitis/chronic pelvic pain syndrome ongoing. It is up to Astellas, said Main, to decide whether the program is worth pushing through.
If they do decide to go with an in-house asset — a decision they will make by fall — Aquinox will most likely leverage their expertise in inflammation, inflammatory pain and blood cancer. It will be a while before they can revive their decimated stock price $AQXP, which fell off a cliff when the bad PhIII news hit, plunging 85% at the time. It’s now trading at $2.90.