Alongside the layoffs, Alligator will also suspend work on all of its earlier-stage assets and devote its resources to lead candidate mitazalimab, being developed for the frontline treatment of metastatic pancreatic cancer.
Swedish biotech Alligator Bioscience on Monday announced that it will lay off 70% of its employees in a sweeping strategic re-evaluation campaign.
After the workforce reduction, Alligator will be down to 15 full-time staff. The layoffs, which are still subject to negotiation with trade unions, will mainly affect employees working in discovery and other nonclinical posts. Alligator expects the restructuring to lower its operating expenses by around $5.9 million annually.
In its third-quarter 2024 financial report, Alligator announced that it had hit net sales of $1.45 million over the first nine months of the year, driven primarily by existing collaborations. This figure was nearly three times lower than the $4.21 million it brought in during the same period in 2023. The operating loss from January to September 2024 was nearly $15.4 million.
As of September 30, 2024, Alligator still had $4.34 million in cash and cash equivalents—down from $11.25 million the same time the year prior—which limits its runway to just one quarter, according to a report summary by GuruFocus News.
In its Monday press release, the biotech cited its “current capital constraints” as the reason for the strategic restructuring. Alligator also announced a Rights issue set to be completed in the first quarter of 2025, which, if fully subscribed, can keep the company afloat through next year.
Aside from the layoffs, Alligator announced that all but one of its assets are now “under strategic evaluation.” Alligator will focus all of its resources on its lead asset mitazalimab, an anti-CD40 monoclonal antibody being assessed for the first-line treatment of metastatic pancreatic cancer. Mitazalimab works by activating and boosting T cells’ anticancer effects.
In June 2024, the biotech published Phase II data for mitazalimab in The Lancet Oncology, touting a 40.4% objective response rate. When combined with the mFOLFIRINOX treatment regimen, mitazalimab resulted in a median duration of response of 12.5 months and prolonged overall survival of 14.3 months.
In its announcement on Monday, Alligator called mitazalimab’s survival benefits “unprecedented,” warranting its advance into late-stage development “as soon as possible.”
“In order to focus our current resources on mitazalimab, our most important asset, we have no other option than to reduce our earlier stage research and development activities and workforce,” CEO Søren Bregenholt said in a statement, adding that “the cost savings announced today will strengthen our ability to continue developing mitazalimab and enhance the chances to unlock its value by making it more attractive for partnership.”
Despite mitazalimab’s promising efficacy profile, it will likely face stiff competition in the pancreatic cancer arena, including Ipsen’s Onivyde (irinotecan liposome injection), which earlier this year was cleared for the first-line treatment of metastatic disease in combination with a three-drug chemotherapy regimen. AstraZeneca’s PARP inhibitor Lynparza is also approved for the first-line maintenance therapy of metastatic pancreatic cancer.
