Staff cuts could leave IGM Biosciences with fewer than 55 employees. The company is also halting development of two bispecific antibody T cell engagers for autoimmune diseases.
IGM Biosciences is cutting 73% of its workforce and stopping development of two autoimmune drug candidates, the biotech announced Jan. 9. Following the news, BMO Capital Markets downgraded the Mountain View, California–based company’s shares from outperform to market perform.
IGM had 198 employees as of Sept. 30, according to a November SEC filing. That means the layoffs could affect about 144 people, leaving the business with fewer than 55 staffers.
Regarding its pipeline, IGM is halting work on imvotamab and IGM-2644, bispecific antibody T cell engagers for autoimmune diseases. In the company’s announcement, IGM CEO Mary Beth Harler said interim data from Phase Ib studies of imvotamab in rheumatoid arthritis and systemic lupus erythematosus showed that the depth and consistency of B cell depletion didn’t meet the biotech’s bar for success. She noted that IGM would discontinue IGM-2644 due to strategic considerations.
The biotech is also considering its next business move so it can maximize shareholder value, in part by evaluating “internal options as well as potential strategic alternatives,” according to the release, which stated that IGM has about $183.8 million in cash and investments as of Dec. 31.
“The update was surprising to us,” BMO analysts wrote, adding that it “speaks to the unpredictability of T cell mediated approaches in cancer and autoimmune disease.”
The investment firm also noted that IGM’s collaboration with Sanofi is now the sole source of revenue for the smaller company, which is working with the pharma giant to create, develop, manufacture and commercialize IgM antibody agonists against immunology and inflammation targets.
“IGMS could leverage its current cash towards business development, but we have low visibility into timing or scope of any future transactions,” BMO stated.
This is the second time in less than six months that IGM has adjusted its pipeline. In September, the company announced it would move away from oncology to focus on its T cell engagers in autoimmune diseases.