Andrew Obenshain, bluebird bio CEO

UP­DAT­ED: Blue­bird joins the lay­off flock to re­al­i­ty as gene ther­a­py biotech sheds staff to save it­self

Blue­bird bio is lay­ing off about 30% of its work­force to save it­self be­fore the FDA de­cides the fate of two of its gene ther­a­pies in Au­gust and Sep­tem­ber and plans to file for a third ap­proval in the first quar­ter of next year.

The dire sit­u­a­tion came in­to clear view ear­li­er this year when blue­bird said in a quar­ter­ly fil­ing its cash prob­lems “raise sub­stan­tial doubt re­gard­ing its abil­i­ty to con­tin­ue as a go­ing con­cern” in the com­ing year. The CFO re­signed the same day.

CEO An­drew Oben­shain told in­vestors Tues­day morn­ing that clin­i­cal holds, ex­tend­ed FDA de­ci­sion dates and the over­all biotech down­turn have all “tak­en some tra­di­tion­al fi­nanc­ing op­tions off the ta­ble in the near-term.”

Keep in mind, blue­bird’s re­cent spin­off, 2sev­en­ty, al­so ran in­to cash prob­lems and had to raise $170 mil­lion last month to stay afloat.

So blue­bird is show­ing the ex­it to near­ly one-third of its staff to ex­tend its cash run­way in­to the first half of next year and save $160 mil­lion over the next two years. The lay­offs will take place this quar­ter and next, blue­bird re­vealed in an SEC fil­ing. Sev­er­ance and ter­mi­na­tion costs will tal­ly near­ly $10 mil­lion, the fil­ing went on. Blue­bird had 518 full-time em­ploy­ees, 330 of whom are in­volved in R&D, as of Jan. 31, the lat­est pub­lic count.

Last month, the biotech said it planned to spend less than $400 mil­lion this year. Now, it’s say­ing that fig­ure will be less than $340 mil­lion as blue­bird ex­pects a 35% to 40% dip in op­er­at­ing costs.

Blue­bird is the lat­est in a string of bio­phar­mas to en­act lay­offs. The list in March alone was enough for a book on the state of the in­dus­try. An­oth­er gene ther­a­py play­er, Dal­las-based Taysha, an­nounced a 35% re­duc­tion last week, fol­low­ing the suit of Zosano, Ovid, Paci­ra, Pas­sage, Adap­tive, Athenex and oth­ers.

Back at blue­bird, the com­pa­ny awaits two FDA de­ci­sions on its lentivi­ral gene ther­a­pies, one for beti-cel (mar­ket­ed in Eu­rope as Zyn­te­glo) for β-tha­lassemia pa­tients who re­quire reg­u­lar red blood cell and the oth­er for eli-cel, which is tar­get­ing a meta­bol­ic con­di­tion called cere­bral adrenoleukody­s­tro­phy. The FDA de­ci­sion dates are Aug. 19 and Sept. 16, re­spec­tive­ly. An FDA ad­comm is ten­ta­tive­ly slat­ed for June 9 and 10.

The ad­comm marks an im­por­tant mo­ment for the gene ther­a­py field, William Blair an­a­lysts not­ed Tues­day, as it is the first time the Cel­lu­lar, Tis­sue, and Gene Ther­a­pies Ad­vi­so­ry Com­mit­tee has met to dis­cuss a prod­uct since Lux­tur­na in Oc­to­ber 2017.

Blue­bird ex­ec­u­tives re­peat­ed­ly de­clined to pro­vide de­tails on pric­ing of the gene ther­a­pies, should they get ap­proved.

The com­pa­ny al­so needs to shore up costs to pre­pare for an­oth­er gene ther­a­py ap­proval re­quest. Blue­bird will ask reg­u­la­tors to green­light its sick­le cell dis­ease gene ther­a­py, lo­vo-cel, in the first quar­ter of 2023.

“Man­age­ment con­firmed on call that the abil­i­ty to achieve prof­itabil­i­ty rests on the ap­proval and com­mer­cial­iza­tion of the SCD gene ther­a­py pro­gram, leav­ing the an­tic­i­pat­ed de­ci­sion for ap­proval of lo­vo-cel in SCD in late-‘23/ear­ly-’24 well be­yond the scope of the cur­rent cash run­way,” SVB Leerink an­a­lysts wrote in a note Tues­day morn­ing.

Lo­vo-cel has been hit by reg­u­la­tor hur­dles al­ready. The agency placed a par­tial hold on blue­bird’s sick­le cell gene ther­a­py tri­als for chil­dren un­der age 18 in De­cem­ber. In Au­gust 2021, the com­pa­ny halt­ed a tri­al for a rare neu­ro­log­i­cal dis­ease af­ter find­ing eli-cel like­ly caused a can­cer-like con­di­tion in a pa­tient.

Oben­shain said the June ad­comm could po­ten­tial­ly “ad­ju­di­cate” the clin­i­cal hold on eli-cel.

If all three ther­a­pies snag ap­proval, blue­bird could serve 22,000 pa­tients in the US, Oben­shain said on the con­fer­ence call.

“The de­ci­sion to re­duce our work­force in sup­port of a more fo­cused set of pri­or­i­ties was not tak­en light­ly, and we are grate­ful to every blue­bird who has helped to progress the field of gene ther­a­py and cham­pi­oned our mis­sion,” Oben­shain said in the news re­lease.

Blue­bird is look­ing at pub­lic and pri­vate eq­ui­ty fi­nanc­ings, as well as con­sid­er­ing mon­e­tiz­ing pri­or­i­ty re­view vouch­ers that might be is­sued up­on ap­proval of ei­ther of its gene ther­a­pies, the com­pa­ny said.

This sto­ry has been up­dat­ed with com­ments from blue­bird’s ex­ec­u­tives on an in­vestor con­fer­ence call and com­men­tary from an­a­lysts. 

Vac­cine doc­u­ments, young lead­ers and mar­ket tur­moil: End­points' 10 biggest sto­ries of 2022

It’s been a volatile year in the world of biopharma. Market declines reset M&A valuations, and may be beginning to tempt bigger buyers back into dealmaking. Russia’s war in Ukraine disrupted drug sales and clinical trials. A new generation of young biotech leaders emerged in the Endpoints 20(+1) Under 40. And as capital runs dry in a tough environment for raising new funds, companies big and small are taking a look at their headcounts and operations for ways to make it through lean times.

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Tom Riga, Spectrum Pharmaceuticals CEO

Spec­trum im­plodes af­ter a harsh pub­lic slap­down and now a CRL from Richard Paz­dur

The FDA has gone out of its way several times to flatten any expectations for Spectrum’s lung cancer drug poziotinib, including slamming the regulatory door in the biotech’s face four years ago when the their executive crew came calling for a breakthrough drug designation and encouragement from the oncology wing of the FDA.

That stinging early rebuke pointed straight down the path to a corrosive in-house agency review of Spectrum’s attempt to land an accelerated approval for the oral EGFR TKI and a public whipping that included a classic takedown by none other than Richard Pazdur, who slammed the company for “poor drug development” that led to confusion over the dose needed for a slice of NSCLC patients harboring HER2 exon 20 insertion mutations.

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Albert Bourla, Pfizer CEO (John Thys/POOL/AFP via Getty Images)

Pfiz­er CEO un­der fire from UK watch­dog over vac­cine com­ments — re­port

Pfizer CEO Albert Bourla told the BBC last December that he had “no doubt in my mind that the benefits, completely, are in favor” of vaccinating 5- to 11-year-olds for Covid-19. Almost a year later, those comments have reportedly landed him in trouble with a UK pharma watchdog.

Children’s advocacy group UsForThem filed a complaint with the UK’s Prescription Medicines Code of Practice Authority (PMCPA) last year accusing Bourla of making “disgracefully misleading” statements during the BBC interview, including one that “Covid in schools is thriving.” At the time, UK regulators had not yet cleared the vaccine for the 5 to 11 age group, though the vaccine did have a positive opinion from the EMA’s human medicines committee.

Big Phar­ma's Twit­ter ex­o­dus; Mer­ck wa­gers $1.35B on buy­out; $3.5M gene ther­a­py; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

As you start planning for #JPM23, we hope you will consider joining Endpoints News for our live and virtual events. For those who are celebrating Thanksgiving, we hope you are enjoying the long weekend with loved ones. And if you’re not — we’ll see you next week!

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Robert Califf, FDA commissioner (Jose Luis Magana/AP Images)

Fourth ac­cel­er­at­ed ap­proval in Duchenne? Sarep­ta gets pri­or­i­ty re­view for gene ther­a­py amid FDA scruti­ny

Sarepta is once again on the accelerated approval path for a Duchenne drug, picking up a priority review Monday morning.

The FDA granted the accelerated review to SRP-9001, Sarepta announced Monday, which would become the biotech’s fourth Duchenne drug if approved. Much like SRP-9001 will do, each of the previous three therapies went through the accelerated approval pathway. But unlike the others, SRP-9001 is a gene therapy.

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Sanofi's new headquarters, La Maison Sanofi, in Paris (Credit: Luc Boegly)

Sanofi wel­comes 500 staffers to new Paris HQ af­ter €30M ren­o­va­tion

When Paul Hudson took the helm at Sanofi back in 2019, he promised to reinvent the pharma giant — including its Paris headquarters. This week, the company set up shop in new “state-of-the-art” digs.

La Maison Sanofi, as the new HQ is called, is officially open for business, Hudson announced on Monday. The 9,000-square-meter (just under 97,000-square-foot) space accommodates 500 employees across the company’s government and global support functions teams, including finance, HR, legal and corporate affairs — and it was built with environmental sustainability and hybrid work in mind.

FDA tells Catal­ent to fix is­sues at two man­u­fac­tur­ing sites on its own

The CDMO Catalent will have to fix issues at two manufacturing plants in the US and Europe that were subject to inspections by the FDA this summer, giving the company room to correct the issues without facing further regulatory action.

The FDA gave Catalent a “voluntary action indicated” response to two inspections at the contract manufacturer’s site in Bloomington, IN, and Brussels, Belgium. Fixing the issues on its own is a preferable outcome to facing an “official action indicated” response, meaning that an official warning would be sent out or a sit-down with the FDA would be required.

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Sta­da to place $50M+ in­vest­ment in a new fa­cil­i­ty in Ro­ma­nia

While Romania may conjure up images of vast mountain ranges and tales of medieval kings, one generic manufacturer has broken ground on a new facility there.

German pharma company Stada said Monday that it has placed a €50 million ($51.9 million) investment into a 100,000 square-meter (1.08 million square-foot) site in Turda, Romania, a city in the Southeast of the country. According to a Stada spokesperson in an email to Endpoints News, the company has developed only 281,500 square feet of the site so far.

Rachael Rollins (Charles Krupa/AP Images)

US seeks jail time for co-CEO of New Eng­land com­pound­ing cen­ter af­ter dead­ly 2012 fun­gal out­break

The US attorney for the district of Massachusetts late last week called on the state’s district court to sentence the former co-owner of the now-defunct New England Compounding Center to 18 months of jail time for his role in the center’s quality deviations that led to more than 100 people dead from a fungal meningitis outbreak.

Gregory Conigliaro was convicted of conspiring with more than a dozen others at NECC to deceive the FDA and misrepresent the fact that the center was only dispensing drugs pursuant to patient-specific prescriptions.