aTyr Pharma Slashes 30% of Employees as it Initiates Corporate Restructuring Following ORCA Failure

Layoffs

Shares of San Diego-based aTyr Pharma are down nearly 20 percent this morning after the company announced a corporate restructuring plan that includes a 30 percent reduction of staff following failures of its preclinical ORCA program.

In its first quarterly report for 2018 aTyr said it will not proceed with submitting an Investigational New Drug Application for the panel of antibodies identified in its ORCA program. The ORCA program was established to target a novel, proprietary immuno-oncology pathway using antibodies to change levels of extracellular histidyl-tRNA synthetase (HARS), known as the Resokine pathway, in tumor settings, according to company data. However, the ORCA work has apparently not achieved what the company was wanting at this time. In its announcement today, the company said that pre-clinical data generated over the last month “failed to show sufficient efficacy to justify further development at this time.” What those details discovered over the past month are were not disclosed by the company during the quarterly report.

But, with that failure, aTyr said it implemented the corporate restructuring program in order to ensure it has enough resources available to continue to develop ATYR1923 and pursue additional research efforts for the ORCA program.

aTyr Chief Executive Officer Sanjay Shukla called this a “very difficult process,” due to the negative impact this will have on the people associated with the company. Shukla was tapped as aTyr’s CEO in November.

“Going forward, we are primarily focused on ATYR1923 and designing a future patient trial which will be influenced by data from our ongoing Phase I trial, translational activities and research related to the role of the receptor for ATYR1923,” Shukla said in a statement.

ATYR1923 is the engineered Physiocrine fusion protein, iMod.Fc. It was developed to enhance the pharmacokinetic properties of the Physiocrine protein in vivo, the company said. ATYR1923 is being developed as a potential therapeutic for patients with rare pulmonary diseases with an immune or fibrotic component, including interstitial lung diseases. As the company moves forward with the program, aTyr said it identified Neuropilin-2 (NRP-2), a pleiotropic receptor that can bind to a number of different ligands, as a binding partner for ATYR1923. The identification was from a screen of greater than 4,500 human membrane proteins. NRP-2 has a well-established role in the development of the neural and lymphatic systems and an emerging role in the adult immune system, the company said. aTyr said it is currently evaluating the role of NRP-2 interactions in the control of immune responses, and designing optimal therapeutic approaches to modulate this newly-discovered receptor in the Resokine pathway.

As aTyr pivots its plans, the company closed out the first quarter with $74.1 million in cash to fund its projects.

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