FibroGen expects its headcount reduction, which is tied to eliminating 75% of its U.S. workforce, to be mostly complete by the end of the first quarter of 2025.
As part of its previously announced elimination of 75% of its U.S.-based workforce, FibroGen will lay off 127 people at its San Francisco location, according to an Aug. 7 Securities and Exchange Commission filing. The biopharmaceutical company, which focuses on novel drugs for cancer, notified employees on Aug. 2.
According to the SEC filing, FibroGen expects to complete most of the headcount reductions by the end of the first quarter of 2025. The company is estimating it will incur nonrecurring charges of $16 million to $18 million in connection with its overall plan to reduce operating expenses, primarily in the form of severance payments, notice pay, accrued vacation, payroll tax and employee benefits contributions.
The force reduction is a result of two late-stage trials failing to meet the primary endpoint of overall survival, according to the company’s July 31 announcement: a Phase II/III trial investigating FibroGen’s experimental drug pamrevlumab in combination with gemcitabine in the first and second line in metastatic pancreatic ductal adenocarcinoma (mPDAC) patients and a separate Phase III trial that assessed pamrevlumab combined with gemcitabine or folfirinox to treat pancreatic cancer. In the announcement, FibroGen noted that it’s implementing an “immediate and significant” cost reduction plan to terminate the pamrevlumab program, halt any obligations to the drug and reduce its headcount.
The company also approved a cost-savings force reduction last year. In a July 2023 SEC filing, FibroGen noted it would cut 32% of its U.S. workforce—104 employees—as part of restructuring plan to lower operating expenses.
In other significant company news this year, AstraZeneca in February shut down most of its roxadustat partnership with FibroGen, returning the rights to develop and commercialize the investigational HIF-PH inhibitor in the United States and other territories to the company. At the time, FibroGen projected its roxadustat revenues to grow in 2024, reaching $300 million to $340 million. In an Aug. 6 press release, the company noted its second-quarter net revenue growth of 14% year over year was driven by strong performance of roxadustat in China, with “robust” year-over-year volume growth of 33%.
