Celladon Lays Off More Staff, Considers Liquidation in Wake of Gene Therapy Failure

Celladon Lays Off More Staff, Considers Liquidation in Wake of Gene Therapy Failure
June 26, 2015
By Mark Terry, BioSpace.com Breaking News Staff

San Diego, Calif.-based Celladon Corporation announced today that it will suspend its Mydicar (AAV1/SERCA2a) program, as well as other pre-clinical programs, including its Stem Cell Factor (mSCF) gene therapy and SERCA2b small molecule programs.

On April 26, 2015 the company announced that its Phase IIb CUPID2 trial for Mydicar failed to meet its primary and secondary endpoints. Celladon focuses on gene therapy, with Mydicar being tested as a gene therapeutic for cardiovascular problems.

In the CUPID2 trial, 250 patients who had stable NYHA (New York Heart Association) class II to IV ischemic or non-ischemic heart failure after therapy, reduced left ventricular ejection fraction and repeated hospitalizations for heart failure, were treated with either Mydicar or placebo.

The primary endpoint was to evaluate the time to recurrent heart failure related events, such as hospitalizations or ambulatory treatment. The secondary efficacy endpoint was time to “first terminal event,” which was defined as “all-cause death, heart transplant or placement of a mechanical circulatory support device.”

“This trial was extremely well executed and adequately tested the hypothesis,” said Barry Greenberg, director of the Advanced Heart Failure Treatment Program and Distinguished Professor of Medicine at the University of California, San Diego (UCSD) in a statement at the time, “but the therapy failed to achieve the primary and secondary endpoints.” Greenberg was also the chairman of the Executive Clinical Steering Committee for the CUPID2 trial.

Celladon stock did not take the news well in April. Shares traded for $13.68 on April 24 and plummeted to $2.64 on April 27. The stock never recovered and is currently selling for $2.20 per share.

In early June Celladon contacted Wedbush PacGrow Healthcare to act as a financial advisor and their intention to develop a strategic plan for a merger or sale of the company. It is also possible Celladon will liquidate some or all of its assets in order to distribute any remaining cash to shareholders.

“Our Board of Directors has unanimously determined that seeking a merger or sale, in lieu of further development of our remaining programs and assets, gives us the best opportunity to maximize shareholder value,” said Paul Cleveland, president and chief executive officer of Celladon in a statement. “We are aggressively pursuing that course. If we are unable to identify a merger or sale that provides superior value to our shareholders, we will move forward with a liquidation and distribution of net cash to shareholders.”

Only a month ago the company slashed about 50 percent of its workforce in order to cut operating expenses and cash reserves. At that time the company employed 34 full-time staff. In today’s announcement it also indicated another workforce reduction, with about half of those who hadn’t already received notice to be notified in the third quarter.

In March 2015, Celladon and Pompey, France-based Novasep announced that they had inked a Development, Manufacturing and Supply Agreement that, if the Mydicar clinical data supported it, Novasep would manufacture Mydicar through 2018 with a potential extension through 2020.

As a result of the failed clinical study, however, the deal was terminated. It also killed a manufacturing agreement with Lonza Biologics Inc.

Mydicar held a great deal of promise in the troublesome gene therapy arena. It was granted both “breakthrough” and “fast-track” status by the U.S. Food and Drug Administration (FDA).

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