Embattled GlobeImmune Loses Gilead Deal, Cancels HQ Lease, and CEO Resigns
November 18, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Louisville, Colorado - In June, there was speculation that embattled GlobeImmune might be a takeover target. A list of bad news and major changes yesterday makes that possibility seem unlikely.
In May, the company’s hepatitis B Phase II clinical trial of GS-4774 failed to meet its primary endpoint. It had gone from 22 staffers to six full-time workers. Its first-quarter loss was $900,000 and the company was considering winding down operations if it couldn’t find a “strategic alternative.”
The company at that time said it had cash and equivalents of about $8.7 million. Executives believed that was enough to keep it operating into mid-2017.
In today’s announcement, Gilead Sciences , had terminated its collaboration and license agreement with GlobeImmune for GS-4774 and returned the rights to the company. The company’s chief executive officer and president, Timothy Rodell, resigned, although he will remain on the board of directors.
Jeffrey Dekker is replacing Rodell as president, as well as secretary and treasurer, and will join the board.
Four members of the board have also resigned. They are William Freytag, Augustine Lawlor, Dan Mitchell and S. Edward Torres.
GlobeImmune had leased a 40,000-square-foot office, laboratory and manufacturing space, which it was using as corporate headquarters. It has terminated that lease.
And in July, the company voluntarily delisted its outstanding Common Stock from The NASDAQ Capital Market and deregistered the Common Stock. One of the outcomes is that, because it is no longer a publicly-traded company, it is not required to release any more information about its operations or business, which in the statement, indicated it did not intend to do.
What remains unaddressed now is the company’s collaboration deal with Celgene Corporation . At its first-quarter financial filings in May, the company indicated that its Phase II trial of GI-6207 in patients with medullary thyroid cancer would be available in the second half of 2016.
There has been no recent update otherwise on this trial by either company.
Gilead, on its part, is being urged by numerous investors and analysts to buy something and fast. The company’s still making a lot of money—its blockbuster Harvoni still brought in $5.58 billion in the first half of this year, but that was down from $7.19 billion in the same period last year.
It seems unlikely that GlobeImmune would be on that shopping list, since it decoupled its collaboration deal. But other companies on the list include Incyte Corporation , Tesaro , Kite Pharma , Intercept Pharmaceuticals , Juno Therapeutics , Vertex Pharmaceuticals , Alexion Pharmaceuticals and Regeneron Pharmaceuticals .
Gilead has $32 billion in cash, cash equivalents and marketable securities. So the possibility of it acquiring more than one company is a definite possibility, if it actually makes an acquisition move. Certainly, investors want it to start showing signs it wants to find replacement revenue for its slowing hepatitis C franchise.
“What we want, Gilead,” Adam Feuerstein wrote for The Motley Fool, “is for you to try. Just try. You’ve wowed us in the past with your M&A acumen, so let’s do it again. Buy a bunch of companies. Buy small. Some mid-sized. Buy revenue now. Reset the pipeline for revenue in the future. Be bold. Show us a path to new growth. Dare to fail. We know not everything will work out.”