Endocyte slashes staff and retrenches in the wake of back-to-back R&D setbacks
Mike Sherman, CEO EndocyteThree years after Endocyte’s shares $ECYT were shredded by the failure of its lead cancer program and Merck’s decision to exit their partnership, the little biotech is back with more bad news to report.
The biotech is retreating on two key clinical fronts, and it announced plans to ax 40% of its staff to help conserve cash as it recalibrates its development plans.
Its stock plunged 34% on the news.
In a statement out Friday the company says it “plans to stop enrollment in the EC1456 trial, where a careful assessment in folate receptor-positive (FR-positive) disease across multiple cohorts of patients and multiple dosing schedules did not yield the level of clinical activity necessary to support continued advancement of this agent.”
Endocyte also says it is lopping off enrollment of taxane-naïve metastatic castration-resistant prostate cancer patients in its EC1169 trial, zeroing in on a taxane exposed group where investigators say they have gathered some evidence of clinical activity.
The once high-flying biotech scored a $1 billion licensing pact with Merck on vintafolide, which also gained a conditional approval in Europe based on positive Phase II data. But the drug subsequently failed to improve progression-free survival for ovarian cancer patients.
This morning, ahead of the news, Endocyte had a market cap of $115 million, with a share price trading at just a fraction of its high in 2014.
“As we refocus our clinical development efforts, we are also aligning our investments and resources to advance our most compelling pipeline programs to key inflection points,” noted CEO Mike Sherman, who came in after the first big setback.
Endocyte says it expects to have $105 million in cash at the end of this year.
