Arbutus Biopharma Announces Major Restructuring, Focuses on Hepatitis B Program

Arbutus Biopharma, a Pennsylvania-based biotech company, has announced a significant restructuring initiative that will see the company dramatically reduce its workforce and narrow its focus to its hepatitis B program. The move comes as part of an effort to improve financial and operational efficiency in the face of challenging market conditions.

Workforce Reduction and Operational Changes

Arbutus revealed plans to lay off 57% of its staff, leaving the company with a core team of just 19 employees. This drastic reduction in personnel is accompanied by several other strategic decisions:

• Termination of all in-house scientific research
• Departure from the corporate headquarters in Warminster, Pennsylvania
• Expected one-time costs of $11 million to $13 million in the first quarter related to the reorganization

The company's leadership is also undergoing changes, with Chief Financial Officer David Hastings, Chief Medical Officer Karen Sims, and Chief Compliance Officer Christopher Naftzger stepping down from their roles. Tuan Nguyen has been appointed as the new CFO, a move that CEO Lindsay Androski states "reinforces our renewed focus on advancing our pipeline efficiently and delivering value to patients and our stakeholders."

Focus on Hepatitis B Program

With this restructuring, Arbutus is doubling down on its hepatitis B program, centered around its lead asset, imdusiran. This investigational RNA interference therapeutic targets liver cells and works by lowering hepatitis B viral protein and antigens. Recent Phase IIa data from the IM-PROVE I trial showed promising results:

• Imdusiran, in combination with other drugs, demonstrated a 25% functional cure rate after six doses
• The company is now reviewing development plans for advancing imdusiran into Phase IIb trials
• Arbutus is exploring ways to potentially accelerate the timeline for this next phase

In addition to imdusiran, Arbutus is developing AB-101, an oral PD-L1 blocker also targeted at chronic hepatitis B. This asset is currently in a Phase Ia/Ib trial, primarily assessing safety and tolerability. The company has progressed to the third part of this early study, which involves repeated doses of AB-101.

Financial Outlook

As of the end of 2024, Arbutus reported:

• Cash, cash equivalents, and marketable securities totaling $122.6 million
• This represents a decrease from $132.3 million the previous year

While specific guidance on cash runway was not provided, the company expects the restructuring to "significantly reduce its net cash burn" in the coming year. The strategic moves announced are clearly aimed at extending the company's financial resources as it focuses on advancing its hepatitis B pipeline.