The company indicates it plans to continue to manage and operate under the bankruptcy filing while it works with Cowen and Company to develop a plan forward.
PhaseRx filed voluntary Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware. The company indicates it plans to continue to manage and operate under the bankruptcy filing while it works with Cowen and Company to develop a plan forward.
The company focuses on developing messenger RNA (mRNA) therapeutics for inherited liver diseases. The company has stated that it expects to have clinical proof-of-concept for its first group of therapies for children with life-threatening inherited liver diseases in 2018.
On Nov. 28, the company announced that the European Medicines Agency (EMA)’s Committee for Orphan Medicinal Products (COMP) gave a positive opinion recommending orphan drug designation for PRX-ASL, PhaseRx’s product for argininosuccinate lyase deficiency (ASLD), a urea cycle disorder.
ASLD is a rare liver disorder caused by an inherited single-gene deficiency. It results in hyperammonemia, or increased ammonia in the blood, and can lead to neurological damage, coma and death. PRX-ASL is an intracellular enzyme replacement therapy.
“This positive opinion recommending orphan drug designation for PRX-ASL in the European Union is a significant step in the development of this product candidate, and follows a similar decision in September by the U.S. Food and Drug Administration,” said Robert Overell, PhaseRx’s president and chief executive officer, in a statement. “We are pleased that the Committee for Orphan Medical Products has affirmed our belief in the need for a new therapeutic for this rare liver disorder.”
PhaseRx announced at its third-quarter financial report on Nov. 9 that it planned to restructure in order to cut short-term operating costs. It also was delaying the development of its other lead product candidate, PRX-OTC. It was also laying off 10 employees, including some executive officers.
Total operating expenses for the quarter were $2.5 million, down from $3.1 million in the same quarter the previous year. Total operating expenses for the nine-month period in 2017 were $9.8 million, significantly lower than the $15.1 million for the same nine-month period in 2016. The differences were largely due to a cut in general and administrative costs.
However, net loss for the third quarter was $2.8 million, or $0.23 per share. The net loss for the nine-month period was $10.4 million, or $0.89 per share. As of Sept. 30, 2017, the company had $5.3 million in cash and cash equivalents.
As part of its current strategic review, the company is considering strategic collaborations, or the licensing, sale or divestiture of some or all of its proprietary technologies.
“The board and management believe that the decision to voluntarily file for Chapter 11 bankruptcy protection is in the best interests of PhaseRx and its shareholders,” Overell said in a statement. “The protection afforded under a Chapter 11 filing enables us to continue to explore strategic alternatives, including a potential merger transaction. During this time we expect to continue to operate normally, and are thankful to our dedicated employees whom we expect to remain focused on the advancement of our programs.”
