Arbutus Biopharma Implements Major Restructuring, Focuses on Hepatitis B Drug Development

Arbutus Biopharma, a biotechnology company specializing in hepatitis B virus (HBV) treatments, has announced a significant restructuring plan that includes substantial workforce reductions and a shift in research strategy. The move comes as the company aims to streamline its operations and accelerate the development of its lead candidate for a functional cure for chronic hepatitis B.

Workforce Reduction and Operational Changes

Arbutus has implemented a 57% reduction in its workforce, retaining only a core team necessary to advance its primary drug candidate, imdusiran, into phase 2b trials. This latest round of layoffs follows a previous 40% staff reduction in August 2024, leaving the company with just 19 employees.

As part of the restructuring, Arbutus will:

• Vacate its corporate headquarters in Warminster, Pennsylvania
• Cease all in-house scientific research
• Part ways with key executives, including Chief Medical Officer Karen Sims, M.D., Ph.D., and General Counsel and Chief Compliance Officer J. Christopher Naftzger

Lindsay Androski, who joined Arbutus as CEO just a month ago, stated, "We have implemented a reduction in our workforce of 57%, retaining a core team well-positioned to advance imdusiran into a phase 2b trial, and have taken additional related steps to improve our financial and operational efficiency."

Focus on Imdusiran Development

The company's primary focus is now on accelerating the development of imdusiran, an RNA interference (RNAi) therapeutic being evaluated as a potential functional cure for chronic hepatitis B virus infection. Imdusiran is currently being assessed in two phase 2a studies in combination with standard-of-care pegylated interferon alfa-2α and Barinthus Biotherapeutic's T-cell stimulating immunotherapeutic VTP-300.

Arbutus is actively reviewing development plans for a phase 2b trial of imdusiran, including potential ways to expedite the development timeline. To assist with this review, the company is retaining experts in virology, hepatitis B, and clinical development and approval of antiviral treatments.

Financial Implications and Future Outlook

The restructuring actions are expected to cost Arbutus between $11 million and $13 million. Despite these expenses, the company entered 2025 with a cash position of $122.6 million.

Arbutus also has an oral PD-L1 inhibitor, AB-101-001, in phase 1 development for chronic HBV. The company stated that next steps for this candidate will be determined upon completion of the review of its chronic HBV programs.

As Arbutus Biopharma navigates this significant transition, the pharmaceutical industry will be watching closely to see how these strategic changes impact the company's progress in developing innovative treatments for hepatitis B.