In the wake of a bruising FDA rejection for its rare pediatric cancer drug, Y-mAbs Therapeutics has followed the increasingly common biotech trend of laying off staff and trimming back its remaining pipeline.
The company had a rough end to the year, with an FDA advisory committee delivering a damning 0-16 verdict on approving omburtamab to treat central nervous system/leptomeningeal metastases in children with neuroblastoma. Panel members expressed skepticism of whether the single arm study had proven the therapy’s effectiveness, with the FDA rejecting the application in December.
While the biotech plans to discuss omburtamab at an upcoming Type A meeting with the agency, it confirmed in a postmarket release yesterday that it's working on an assumption that the omburtamab program will be deprioritized.
The resulting restructuring of the company will see 35% of employees laid off by the end of May. Various other pipeline programs are also being sacrificed, including the GD2-GD3 vaccine in phase 2 trials for neuroectoderm-derived tumors, as well as the CD33 bispecific antibody in phase 1 trials for pediatric acute myeloid leukemia.
The changes should slash Y-mAbs’ operating costs by 35%, extending the company’s cash runway into 2026, the biotech pointed out.
Instead, Y-mAbs will focus on a label extension for Danyelza—which was approved in 2020 for pediatric neuroblastoma and looks set to enter the Chinese market soon—as well as its Self-Assembly DisAssembly (SADA) radioimmunotherapy platform. Y-mAbs hopes to soon dose the first patient with GD2-SADA, a treatment produced by the platform that’s entering a phase 1 trial for small cell lung cancer, malignant melanoma and sarcoma.
The company also expects to submit a request in the second quarter of the year to begin human trials for CD38-SADA, another product from the platform that targets non-Hodgkin lymphoma. Y-mAbs is also on the hunt for partners for its SADA technology.
“We believe that this restructuring of the organization aligns our resources to efficiently leverage both the Danyelza franchise and support development activities for our highly differentiated novel SADA platform, which we view as the key near and long-term potential growth drivers of Y-mAbs,” CEO Thomas Gad said in the release.
“We believe this sharpened focus should propel us through key anticipated milestones, including continuation and potential expansion of the commercialization of Danyelza for neuroblastoma patients and potential indication expansion,” the CEO added.
The layoffs mark a tough landing for Y-mAbs, which as recently as 2019 was going on a hiring spree on the back of a $96 million IPO the previous year. The company’s optimism at the time was supporting by the anticipated approval of Danyelza as well as high hopes for omburtamab.
The latest news did little to budge the company’s share price, which remains just under the $5 mark after plunging from $15 in October in response to the advisory committee's verdict.