A dose of CureVac vaccine or a placebo is seen during a study by the German biotech firm CureVac as part of a testing for a new vaccine against the coronavirus disease (COVID-19), in Brussels, Belgium March 2, 2021.
FibroGen's pamrevlumab recently failed two late-stage clinical trials. In photo: a dose of CureVac vaccine or a placebo is seen during a study by the German biotech firm CureVac as part of a testing for a new vaccine against the coronavirus disease (COVID-19), in Brussels, Belgium March 2, 2021. Reuters / Yves Herman

KEY POINTS

  • The company is expecting to save up to $35 million in annual expenses due to the restructuring
  • Phase 3 trials of pamrevlumab for IPF and Duchenne Muscular Dystrophy failed, the company said last month
  • FibroGen previously announced plans to implement 'significant' cost-cutting measures in the U.S.

Biotechnology company FibroGen is reducing its workforce after recent failed clinical trials, marking the third time a biotech firm in the Bay Area has implemented workforce cuts this year.

FibroGen will reduce its workforce by approximately 32%, affecting 104 employees, the company said in a Wednesday filing with the SEC. The company said it is expecting charges between $13 and 15 million in relation to the restructuring plan. It is also expecting to save up to $35 million in annual expenses as a result of the restructuring.

"The Company would like to extend its tremendous gratitude to these employees, not only for their contributions to the strong workforce and culture at FibroGen, but to their large part in the progress we have made, and continue to make, in science and the biotechnology industry," FibroGen said.

The layoffs at FibroGen come nearly a month after the company said that its experimental lung disease drug pamrevlumab for the treatment of idiopathic pulmonary disease (IPF) failed the phase three trial. At the time, the company said pamrevlumab was "generally safe and well tolerated," but the "study did not meet the primary endpoint."

"We are deeply disappointed that these results do not support pamrevlumab as a new treatment for IPF," said Mark D. Eisner, FibroGen's chief medical officer. Still, the company thanked the patients and clinical trial investigators who participated in the trials.

The company also said last month that it was looking to implement "a significant cost reduction effort in the U.S. with the intent to extend our cash runway into 2026."

Earlier last month, the company also announced that the phase three clinical study of pamrevlumab in non-ambulatory patients with Duchenne Muscular Dystrophy failed.

FibroGen's CEO Enrique Conterno said that while the company was disappointed with the results, it was planning to share the data it collected from the study at a future medical conference "to contribute towards the understanding of this devastating disease."

FibroGen joins two other biotech companies in the Bay Area to implement layoffs this year.

Late last month, Illumina announced in an SEC filing that it started a workforce reduction "as part of a multiyear plan to realign its operating expenses." The company said it also expects further cuts in the third quarter, but did not provide details about the exact number of employees affected.

Illumina said it was also planning to reduce its real estate footprint by leaving its i3 campus in San Diego, and was looking at options regarding its Foster City site.

In March, Genentech said it was winding down operations at its San Francisco facility, resulting in 265 job cuts, as per Fierce Pharma. The biotech firm said that instead of shutting down the entire team, most staffers were transitioned to a new clinical supply center in the same area.

In the wider tech space, a total of 221,045 tech employees have lost their jobs so far in 2023 as a result of layoffs at 877 companies, as per data from the layoffs tracker layoffs.fyi.

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