Staff cuts will leave IGM Biosciences with 37 employees. The company is also halting development of two bispecific antibody T cell engagers for autoimmune diseases.
IGM Biosciences is cutting 73% of its workforce and stopping development of two autoimmune drug candidates, the biotech announced Jan. 9. Following the news, BMO Capital Markets downgraded the Mountain View, California–based company’s shares from outperform to market perform.
The layoffs will affect 100 employees effective March 10, according to a Worker Adjustment and Retraining Notification Act (WARN) notice processed Jan. 14. That means the cuts will leave the business with 37 employees.
Regarding its pipeline, IGM is halting work on imvotamab and IGM-2644, bispecific antibody T cell engagers for autoimmune diseases. In the company’s announcement, IGM CEO Mary Beth Harler said interim data from Phase Ib studies of imvotamab in rheumatoid arthritis and systemic lupus erythematosus showed that the depth and consistency of B cell depletion didn’t meet the biotech’s bar for success. She noted that IGM would discontinue IGM-2644 due to strategic considerations.
The biotech is also considering its next business move so it can maximize shareholder value, in part by evaluating “internal options as well as potential strategic alternatives,” according to the release, which stated that IGM has about $183.8 million in cash and investments as of Dec. 31.
“The update was surprising to us,” BMO analysts wrote, adding that it “speaks to the unpredictability of T cell mediated approaches in cancer and autoimmune disease.”
The investment firm also noted that IGM’s collaboration with Sanofi is now the sole source of revenue for the smaller company, which is working with the pharma giant to create, develop, manufacture and commercialize IgM antibody agonists against immunology and inflammation targets.
“IGMS could leverage its current cash towards business development, but we have low visibility into timing or scope of any future transactions,” BMO stated.
This is the second time in less than six months that IGM has adjusted its pipeline. In September, the company announced it would move away from oncology to focus on its T cell engagers in autoimmune diseases.
Update (Jan. 17): This article was updated to specify the number of employees being laid off, when the cuts are effective and how many people will remain with the company based on a WARN notice processed after the article’s publication.
