A new ax cuts the deepest. And new Arena Pharmaceuticals $ARNA CEO Amit Munshi is using his shiny blade to whittle the company down to fit his profile of a lean, mean, drug development machine — even as his old company Epirus struggles to survive.
With company co-founder Jack Lief long gone after the miserable debut of weight loss drug Belviq, Munshi is getting back to basics. And he’s cutting 100 staffers in the process — 73% of the remaining U.S. staff, which had already had its ranks thinned in an earlier restructuring.
The cuts are aimed across three primary areas: Research, manufacturing and G&A.
What’s left? About 35 staffers in the U.S., who will be devoted to the development of a small pipeline of experimental therapies.
At the top of the list is Etrasimod (APD334), an S1P1, receptor in Phase II for ulcerative colitis, with the potential to be tested in other indications. Ralinepag (APD811) – an agonist of the prostacyclin receptor – is in an ongoing Phase II trial for pulmonary arterial hypertension. Then there’s APD371, a cannabinoid-2, or CB2, receptor agonist in Phase I.
Arena also has partnerships in place with a variety of companies, including the neurodegeneration upstart Axovant, Eisai and Boehringer Ingelheim.
Munshi was an unusual choice to play turnaround CEO at the troubled Arena. He landed his new job just as he was being bounced as founding CEO of the offbeat biosimilar company Epirus, which was looking to capitalize on an unusual niche strategy in a field dominated by giants.
As Munshi stepped into his new role at Arena, Epirus’s shares $EPRS were plunging into penny stock territory, where they remain as 5AM’s Scott Rocklage works to salvage the operation from a cash crisis. Munshi took up his new role ready to reorganize Arena, as Epirus was shedding a majority of its staff to survive the storm.
Two weeks ago Epirus sold an operation in The Netherlands for $3.5 million in badly needed cash.
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