Ardelyx said today it will eliminate 28% of its workforce—30 employees—leaving the company with 76 employees in a restructuring that will refocus the drug developer on its later-stage pipeline programs.
The job cuts will affect “primarily…research and certain development and general administrative personnel,” Ardelyx disclosed in its quarterly earnings regulatory filing.
“We expect that the workforce reduction will be substantially completed by September 1, 2017, and will be entirely completed by November 1, 2017,” the company projected in a Form 10-Q, filed today.
Ardelyx said it expects to incur approximately $0.8 million in one-time expenses related to employee severance benefits and related costs. Most of the charge is expected to be reflected in Q3 results. The company also projects that the savings will extend its financial operating “runway” to the end of 2018.
“As we look ahead, we are confident that the changes we are making now, and the extraordinary team that remains at Ardelyx, will best position us to efficiently execute on our near-term milestones and to create value in the future,” Ardelyx president and CEO Mike Raab stated in the company’s quarterly earnings press release.
Just last year, Ardelyx was speculated by some analysts to be ripe for acquisition—the company was included in GEN’s “Top 10 Takeover Targets of 2016”—on the strength of its pipeline, which focuses on gastrointestinal and renal disorders, as well as M&A by other drug developers in the segment, including Relypsa’s $1.53 billion acquisition by Galenica Group and Allergan’s purchase of two companies focused on nonalcoholic steatohepatitis (NASH) treatments.
Focus on Tenapanor, RDX7675
The workforce reduction followed a strategic review by the company of its operations that resulted in a restructuring that will focus the company on three late-stage clinical programs.
Two of the late-stage programs relate to Ardelyx’s lead product candidate tenapanor, a sodium–hydrogen exchanger 3 (NHE3) inhibitor to which the company regained rights in 2015 following termination of a nearly three-year collaboration with AstraZeneca to develop the compound and other NHE3 inhibitors.
Ardelyx expects results early in the fourth quarter from its Phase III T3MPO-2 trial assessing tenapanor in patients with irritable bowel syndrome with constipation (IBS-C). Ardelyx plans to use results from T3MPO-2 and another Phase III trial that showed positive results, T3MPO-1, as the basis of a New Drug Application for tenapanor for IBS-C, which the company said it expects to submit in 2018.
In the second tenapanor program, Ardelyx said it expects to begin patient enrollment by October in a second Phase III trial assessing the candidate as a hyperphosphatemia treatment for patients with end-stage renal disease (ESRD) on dialysis.
The company is awaiting FDA feedback on the study’s protocol, which is expected to consist of a 26-week randomized treatment period followed by an up to 12-week, double-blind, placebo-controlled, randomized withdrawal period with an open-label extension. Ardelyx announced positive results from the first Phase III trial of tenapanor for hyperphosphatemia in ESRD dialysis patients in February.
Three months later in May, the company trumpeted positive results from T3MPO-1, which showed tenapanor to have achieved statistical significance for the primary endpoint: More tenapanor-treated patients had at least a 30% percent reduction in abdominal pain and an increase of one or more complete spontaneous bowel movements (CSBM) in the same week for at least six of the 12 weeks of the treatment period compared to patients receiving placebo.
Tenapanor also showed significant impact on both constipation and abdominal pain in nine of 12 weeks and maintained the effect in three of the last four weeks in those patients while also showing a favorable safety profile, Ardelyx added.
Also during the fourth quarter, Ardelyx expects to report results from an onset-of-action study of RDX7675, an oral, nonabsorbed potassium-binding polymer under development for hyperkalemia. That study was launched earlier this year, along with a single Phase III trial whose results are expected to support registration of RDX7675
“Based on the clinical data we've generated to date, we are highly confident in both the registration and commercial potential for tenapanor and RDX7675,” Raab added.
