Lava Therapeutics Implements Strategic Restructuring Amid Pipeline Shift

Lava Therapeutics, a biotech company specializing in gamma delta T-cell engagers, has announced a significant restructuring initiative following the discontinuation of its lead blood cancer drug. The move comes as the company refocuses its efforts on a new lead candidate and explores strategic opportunities to maximize shareholder value.

Workforce Reduction and Cash Conservation

In a bid to conserve cash, Lava Therapeutics has implemented a 30% reduction in its workforce. The layoffs are expected to incur one-time costs of approximately $500,000. CEO Steve Hurly emphasized that employees deemed "essential for supporting value creation" have been retained. This cost-cutting measure aligns with the company's broader strategy to extend its financial runway and redirect resources to its most promising programs.

Pipeline Reprioritization

Following the December decision to discontinue its lead blood cancer drug due to failure to meet "internal benchmarks," Lava has shifted its focus to LAVA-1266. This CD123-targeting T-cell engager is being developed for acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). The company is currently enrolling patients in a phase 1 study of LAVA-1266 in hematologic malignancies.

Strategic Review and Partnerships

Lava Therapeutics has initiated a comprehensive review of strategic options to enhance shareholder value. CEO Hurly stated, "Lava is in a strong position to unlock strategic opportunities for the company, in addition to our proprietary pipeline and partnered programs." These options may include in-licensing assets, sale, merger, or acquisition.

The company maintains collaborations with major pharmaceutical players. A partnership with Pfizer involves an EGFR and bispecific gamma delta T-cell-receptor-targeted therapy for solid tumors, currently in phase 1 trials. Additionally, Lava is preparing for an early-stage study of a Johnson & Johnson-partnered CD33 and Vγ2 T cell-targeting bispecific gamma delta T-cell engager.