Layoffs hit another biotech as Duchenne player Solid Bio cuts staff by 35%
Another biotech has joined the ranks of the reorganized, as Duchenne player Solid Biosciences reported a new way of doing things Wednesday and announced layoffs and a C-suite departure.
Solid Bio is reducing its workforce by 35%, according to an SEC filing for its first-quarter results Wednesday, in addition to a new emphasis on its two gene therapies. The pipeline shift includes an outsourced manufacturing process rather than what was used previously, allowing for a more streamlined development process, the company said.
“We believe that a new, outsourced process may provide improvements to manufacturability as well as additional organizational efficiencies,” Solid Bio said in its 10-Q. “We anticipate that the use of transfection-based manufacturing processes for both SGT-001 and SGT-003, will allow us to focus our operating structure and better leverage external manufacturing expertise.”
On top of all this, COO Joel Schneider will leave the company at the end of May to become CEO of a private gene therapy biotech. Shares of Solid Bio $SLDB, already a penny stock, did not react much to the news, dropping about 1% in early Wednesday trading.
Wednesday doesn’t mark the first time Solid Bio has run into some setbacks. Its lead gene therapy, dubbed SGT-001 and designed to treat Duchenne muscular dystrophy, has run into several roadblocks at the FDA including multiple clinical holds over the last few years.
The holds have since been lifted, but an initial data cut released in March 2021 did not appear to invigorate investors as much as the biotech hoped. Though the trial was designed to evaluate microdystrophin protein expression and distribution, Solid Bio emphasized functional and patient-reported outcomes at the 12-month mark instead.
At the time, analyst Joseph Schwartz said the results represented a “glimpse” of hope in the drug’s effectiveness. But in an investor call Wednesday, Schwartz still appeared unsatisfied with the biotech’s ability to mitigate the risk for patients. He asked execs about how Solid Bio is setting up its protocol to ensure patients can tolerate the drug, given the new manufacturing process.
Roxana Donisa Dreghici, Solid Bio’s head of clinical development, acknowledged that though the company is confident in its protocol, there still may be some changes.
“We’ve definitely optimized our follow up of the patients of previous two infusions and infusions after the first couple of weeks of monitoring,” she said, alluding to patients who took the drug before the manufacturing shift. “We’re making sure everything is still applicable for the new material.”
CEO Ilan Ganot added that Solid Bio has already started engaging with regulators about the changes, and intends to be ready to dose in early 2023. Solid Bio had previously partnered with Forge Biologics on manufacturing, but is “building a new relationship” with another unnamed vendor to produce SGT-001, he said.
Wednesday’s news comes amidst a tsunami wave of layoffs across the biotech sector, with seemingly a new company announcing a “restructuring” every day. It’s a much different environment than the industry saw during the peak months of Covid-19 quarantine, signified by a stark figure — as of Tuesday, the XBI fell to the same level it was in April 2020, when the pandemic was in its early months.