Vical slashes staff after culling phase II antifungal
US biotech Vical is planning another round of job cuts after deciding to abandon its antifungal drug VL-2397, its last remaining clinical-stage asset.
The San Diego company only started the phase II trial of VL-2397 last year, but says a slow uptake of patients into the trial, coupled with a need to conserve cash, is behind the decision.
It has been looking for “strategic alternatives” since two of its other clinical programmes ended in failure, but suggested last July that it had enough cash on hand to get to the end of the phase 2 trial in invasive aspergillosis in immunocompromised adults with acute leukaemia or recipients of an allogeneic hematopoietic cell transplant.
The clock has now run down for that option, and with around $50 million in accessible cash remaining Vical has opted to abandon all development activities and focus on trying to bring the strategic review to a close. Its cash burn last year was $12.4 million, above its guidance of $8 to $11 billion for the year.
Despite the decision to pull the study, Vical says it believes in the “potential benefits of VL-2397,” according to chief executive Vijay Samant. The drug has been awarded qualified infectious disease product, orphan drug and fast track designations from the FDA, and the firm has previously suggested that a single phase II trial may be enough to support approval in that indication.
According to Vical’s last quarterly statement in October 2018, its only other development candidate was a preclinical-stage hepatitis B virus (HBV) drug.
Vical’s headcount has already declined significantly after the earlier setbacks, which involved a therapeutic vaccine for genital herpes in phase II and a cytomegalovirus vaccine programme licensed to Astellas Pharma, and there’s no news yet on just how many more staff will be axed. Last January it slashed its headcount by 40 to just over 30 people.
Definitely heading for the exit is Vical’s senior vice president for clinical development Mammen Mammen, whose job was terminated this week. He leaves the company with a severance package valued at around $420,000, according to a Securities & Exchange Commission (SEC) filing.
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