Aviragen Therapeutics said today it will cut its workforce by approximately 25% and explore “strategic alternatives” that could include a merger or sale of the company.
The workforce reduction would be small, amounting to approximately five jobs, based on the 21 full-time employees that Aviragen said constituted its workforce as of June 30, 2016. The 21 consisted of employees engaged in R&D, and eight engaged in corporate, administration, finance, and business development activities.
No timeline has been set for completion of the revision of strategic alternatives, which Aviragen said include “a business combination or strategic merger, in-licensing clinical-stage programs, an acquisition, or other transaction that would complement the Company’s current pipeline and could maximize both near- and long-term value for our shareholders.”
Aviragen disclosed its planned layoffs and review a day after acknowledging that it faces de-listing of its shares from the NASDAQ Global Select Market since its shares closed below the $1 minimum for 30 consecutive business days.
“The company intends to monitor the bid price of its common stock and its minimum market value of listed securities and will consider options available to it to achieve compliance,” Aviragen stated yesterday in a regulatory filing.
Aviragen has seen its stock price fall by nearly half since February 1, following the disclosure of two mid-stage clinical trial failures in February. From a closing price of $1.23 on February 1, shares have tumbled to $0.66 at yesterday’s close.
The company began that month by acknowledging topline results showing that its oral fusion protein-inhibitor candidate BTA585 missed its primary endpoint in a Phase IIa trial of a significant reduction in viral load in adults challenged intranasally with respiratory syncytial virus (RSV).
Aviragen said February 1 it would analyze full data from the trial and announce future plans for BTA585 in the second quarter. In today’s statement, Aviragen said it “continues to progress” in activities designed to support a response to the FDA’s clinical hold placed last year on its IND application for BTA585, after one patient was hospitalized for less than a day following increase of a cardiac enzyme level coupled with transient ECG changes.
A day after the BTA585 failure, Aviragen sought to reassure investors and others: “We are very committed to the advancement of our pipeline and are confident of its potential to address considerable unmet clinical needs for patients with limited therapeutic options,” President and CEO Joseph M. Patti, Ph.D., said in the company’s announcement of results for its second fiscal quarter of 2017; the company’s fiscal year ends June 30.
But on February 13, Aviragen revealed its second mid-stage clinical disappointment in as many weeks when it announced that its lead pipeline candidate vapendavir failed the Phase IIb SPIRITUS trial evaluating the oral capsid-binding antiviral drug in asthma patients with rhinovirus infection.
Vapendavir missed its primary endpoint by failing to show a statistically significant reduction in the asthma control questionnaire-6 (ACQ-6) at day 14 following treatment at patient cohorts receiving either 264 mg or 528 mg dosages. After that failure, Dr. Patti stated that the company would fully evaluate data from the SPIRITUS study before deciding future actions for vapendavir.
Based on that evaluation, Aviragen said today, it will not start a Phase II trial assessing the candidate in hematopoietic stem cell transplant patients with rhinovirus infection: “The Company is evaluating a potential clinical development path for the drug based on the consistent antiviral effect observed in the Phase IIb SPIRITUS trial and previous clinical studies and its favorable safety profile.”
Aviragen added that it is continuing development of its non-nucleoside inhibitor program for the treatment of RSV infections, as well as with randomization of patients in a Phase II trial of BTA074, a topical antiviral treatment for condyloma caused by human papillomavirus (HPV).