Atara Biotherapeutics’ layoffs could leave the biotech with around 80 employees. The cuts follow news that the FDA rejected Ebvallo, a T cell therapy approved in Europe for a transplant-related blood cancer, and placed a clinical hold on the company’s active drug applications.
Following the FDA’s rejection of Atara Biotherapeutics’ T cell therapy for a transplant-related blood cancer and a related clinical hold, the company has divulged that it will cut about 50% of its workforce. The biotech expects to mostly complete the layoffs by June, according to the Jan. 27 SEC filing.
Atara had 159 employees as of Sept. 30, as noted in a Nov. 12, 2024, SEC filing, which means the layoffs could leave the company with around 80 employees. The biotech did not specify which locations the workforce reduction will affect. Atara has its headquarters and a research center in Thousand Oaks, California, as well as a location in Aurora, Colorado.
While the company did not state the reason for the layoffs, it’s had two FDA-related setbacks this month. On Jan. 16, the FDA rejected Ebvallo, which is approved in Europe for patients with post-transplant lymphoproliferative disease who are positive for the Epstein-Barr virus, citing unresolved manufacturing concerns. In its announcement, the company noted it’s in active discussions with several potential parties regarding strategic alternatives that could include an acquisition, merger, reverse merger, sale of assets or other strategic transactions.
Then, the FDA took the additional step of placing a clinical hold on the biotech’s active Investigational New Drug applications due to the same manufacturing concerns that led to Ebvallo’s rejection. In addition to Ebvallo, the hold also affected the company’s allogeneic CD19 CAR T therapy ATA3219, which it’s testing for non-Hodgkin’s lymphoma and systemic lupus erythematosus.
Atara had to suspend screening and enrollment of new study patients in both programs. Only those already enrolled in trials who could “potentially derive clinical benefit” can continue receiving treatment under ongoing study protocols.
In its Nov. 12 SEC filing, Atara reported a net loss of $72.7 million for the first nine months of 2024. As of Sept. 30, it had an accumulated deficit of $2 billion and cash, cash equivalents and short-term investments totaling $67.2 million.
Atara expects the workforce reduction will cost about $7.5 million total for severance and related benefits but noted it may incur other charges related to the workforce reduction, according to the Jan. 27 filing.
