January 22, 2016
By Alex Keown, BioSpace.com Breaking News Staff
PHILADELPHIA – TetraLogic Pharmaceuticals plans to eliminate two-thirds of its employees by next month following the failure of a Phase II treatment for high-risk patients with myelodysplastic syndromes earlier this month.
The company filed a regulatory report with the U.S. Securities and Exchange Commission that included an announcement of the pending layoffs, the Philadelphia Business Journal reported this afternoon. After the company terminates the 19 employees it plans to, TetraLogic will be left with 10 employees, the Journal said. Among those terminated are G. Glenn Begley, the company’s chief scientific officer, and Lesley Russell, the company’s chief operating officer. Their termination will occur on April 19, the Journal reported.
The layoffs come about two weeks after TetraLogic announced the failure of birinapant, a treatment for high-risk patients with myelodysplastic syndromes. Phase II trial results showed birinapant did not demonstrate any clinical benefit over placebo for the primary endpoint of response rate after four months of therapy. Because of the failure, the study has been terminated, the company said.
Myelodysplastic syndromes are a group of cancers in which immature blood cells in the bone marrow do not mature or become healthy blood cells. In patients diagnosed with myelodysplastic syndrome, the “blood stem cells (immature cells) do not become mature red blood cells, white blood cells, or platelets in the bone marrow. These immature blood cells, called blasts, do not work the way they should and either die in the bone marrow or soon after they go into the blood. This leaves less room for healthy white blood cells, red blood cells, and platelets to form in the bone marrow. When there are fewer healthy blood cells, infection, anemia, or easy bleeding may occur,” according to a report on cancer.gov.
According to the filing, the layoffs are expected to save TetraLogic a one-time restructuring charge of about $2.2 million in the first fiscal quarter of 2016. However, the company noted that estimate could change as a result of other expenses that have not been finalized.
In addition to the failing Phase II trial of birinapant, TetraLogic reported results from a separate Phase II trial of its topical HDAC inhibitor for the treatment or cutaneous T-cell lymphoma, or CTCL, which showed eight of 34 patients exhibited a positive response to treatment. Additionally, trial results showed a secondary endpoint was reached showing 11 of 34 patients responded and a further 14 patients had stable disease at the 6 month endpoint, the company said.
Still, that touch of good news was not enough to stave off a massive hit to TetraLogic’s , which tumbled 64 percent. The stock was trading at $1.84 per share when the company announced the Phase II failure. The stock is currently trading at 30 cents per share.
