Shares of Bluebird Bio have plunged 62% since the company spun off its oncology business in November—including a 10% stock price drop triggered by Bluebird’s disclosures about the resignation of its CFO and doubts about its ability to continue as a growing concern.
Bluebird shares finished trading at $5 a share, down from $13.14 on November 15, when the post-spinoff Bluebird Bio started trading its shares.
Bluebird acknowledged Monday in a regulatory filing that Gina Consylman, the company’s CFO and treasurer, had given notice Friday of her resignation, effective April 3.
Consylman’s resignation comes seven months after she joined the company as CFO of its severe genetic business. She advanced to CFO of the entire company after Bluebird spun off its 13 oncology programs (seven clinical, six preclinical) into 2seventy bio. That public company is headed by “Chief Kairos Officer” Nick Leschly, who served as Bluebird’s CEO or “chief Bluebird” from 2010 until the separation, which left the surviving Bluebird with three candidates and an R&D focus on severe genetic diseases.
Bluebird said Consylman is expected to be succeeded by its CBO, Jason F. Cole.
Cole was appointed CBO in November 2021. He previously served as Bluebird’s chief operating and legal officer from February 2019 to November 2021. He was named Bluebird’s chief legal officer in 2016.
Three days before Consylman’s resignation was disclosed, on March 4, Bluebird raised questions about its ability to continue in business for one year after the date that its consolidated financial statements for the year ended December 31, 2021, are issued.
The company cited a drop in its cash, cash equivalents, and marketable securities since the separation of the Bluebird operations. As of December 31, 2021, that total stood at $396.6 million—down 22% from the approximately $507.2 million Bluebird had at the time of the separation (though the latter includes restricted cash). Bluebird said it expects a “cash burn” or spending of less than $400 million this year.
“There is substantial doubt regarding our ability to continue as a going concern,” Bluebird acknowledged in its Form 10-K annual report for 2021. We will need to raise additional financing in upcoming periods, which may not be available on acceptable terms, or at all.
“Failure to obtain necessary capital when needed may force us to delay, limit, or terminate our commercial readiness efforts, activities to support a potential commercial launch following any approval of our product candidates, or other operations,” Bluebird cautioned.
Bluebird disclosed its doubt upon releasing fourth-quarter and full-year 2021 results. The company finished 2021 with a net loss from continuing operations of $562.6 million on revenue of just $3.7 million, compared to a $561.1 million net loss from continuing operations for 2020, a year during which it recognized no revenue from continuing operations.
The company’s accumulated deficit stood at $3.72 billion as of December 31.
During Q4, Bluebird reported a $132.3 million net loss from continuing operations, with only $1.6 million in revenue, compared with $136.3 million and no revenue in 2020.
In a statement, Bluebird Bio CEO Andrew Obenshain said the company was staying the course of the comeback strategy he detailed to GEN Edge in November 2021: Pursue approvals and commercialize the three severe genetic disease candidates in its pipeline; maintain the company’s commitment to lentiviral vector (LVV) gene therapies, while investing in extending its core LVV platform into direct in vivo LVV, cutting costs; and exiting Europe following disputes with European payers on pricing for its gene therapies.
Biologics License Applications (BLAs) for two of Bluebird’s gene therapies are under FDA review: Betibeglogene autotemcel (beti-cel), the company’s potentially curative gene therapy for adult, adolescent, and pediatric patients with β-thalassemia across all genotypes who require regular red blood cell (RBC) transfusions; and elivaldogene autotemcel (eli-cel), a gene therapy for cerebral adrenoleukodystrophy in patients less than 18 years of age.
The company plans in the first quarter of 2023 to submit a BLA for its third gene therapy candidate, lovo-cel (formerly called LentiGlobin® or bb1111) for sickle cell disease (SCD).
“2022 is set up to be a landmark year for Bluebird Bio, with LVV gene therapies for β-thalassemia and cerebral adrenoleukodystrophy under review by the [FDA] and plans to submit a BLA for lovo-cel for SCD early next year,” Obenshain stated. “Underscoring these significant milestones is a continued focus on commercialization and financial discipline to enable the delivery of these transformative therapies to patients and their families.”
Both lovo-cel and eli-cel are under FDA clinical holds.
Last year, the FDA placed a hold on two trials of lovo-cel, then called LentiGlobin (the Phase I/II HGB-206 and Phase III HGB-210 studies) that Bluebird suspended in February 2021 after reports that two participants in the earlier-phase study developed blood cancers—one case of myelodysplastic syndrome (MDS), the other of acute myeloid leukemia (AML). Last April, the trial’s treating investigator revised the diagnosis of the reported MDS patient to anemia. The FDA lifted that hold in June, three months after Bluebird said it was “very unlikely” that its BB305 LVV caused the case of AML.
Lovo-cel was placed on partial hold for patients under age 18 in December 2021 after an adolescent patient showed persistent, non-transfusion-dependent anemia 18 months after treatment with the gene therapy. Bluebird said the patient was “clinically well” with “no evidence of malignancy or clonal predominance.”
“The company continues to work with regulators to resume treating patients under the age of 18,” Bluebird said in announcing Q4 and 2021 results. “In the meantime, the company is collecting comparability data from drug product lots manufactured for adult patients in the HGB-210 study.”
The hold on lovl-cel did not affect enrollment and dosing for patients ages 18+ with SCD in the HGB-206, HGB-210, and LTF-307 trials. Follow up for treated patients of all ages in all studies continued as planned.
The eli-cel BLA filing was made despite a clinical hold imposed last August after a patient dosed with eli-cel developed MDS.
“The FDA has notified the company that the clinical hold on the elivaldogene autotemcel (eli-cel) program will remain in place and requested additional information about safety events and monitoring in the eli-cel clinical program,” Bluebird stated on March 4.
Beti-cel won FDA acceptance for priority review in November, and eli-cel a month later. But in January, the FDA extended the review period for the beti-cel BLA and revised the Prescription Drug User Fee Act (PDUFA) target date for an FDA decision to August 19. Also in January, the FDA extended the review period for the eli-cel BLA, revising the PDUFA date to September 16.
In advance of action by the FDA, both beti-cel and eli-cel are expected to be discussed in June by an advisory committee of the agency.
“Approvals of beti-cel and eli-cel are absolutely critical for BLUE‘s business life-line as sales of priority review voucher (PRVs) from these approvals can extend its currently ~1 year of expected cash runway,” Mani Foroohar, MD, senior managing director, genetic medicines, and a senior research analyst with SVB Leerink, wrote Sunday in a research note.