Spruce Biosciences Restructures, Shifts Focus to Rare Disease Drug

Spruce Biosciences, a California-based biotech company, has announced a significant restructuring and strategic shift following a series of setbacks in its drug development pipeline. The company is now pinning its hopes on a newly acquired rare disease candidate as it navigates a challenging period in its history.

Workforce Reduction and Strategic Realignment

Spruce Biosciences has implemented a dramatic 55% reduction in its workforce, effective immediately. This move comes on the heels of a licensing deal for a former BioMarin rare disease candidate, signaling a sharp pivot in the company's focus. The layoffs, which will be completed by May 2, are expected to cost the company nearly $1 million but are deemed necessary to align with the new strategic direction.

The biotech ended 2024 with 21 employees, and this latest cut represents a significant downsizing of its operations. Spruce's management believes this restructuring will streamline the company's efforts towards its new goal: seeking accelerated approval for its newly acquired enzyme replacement therapy.

From Setbacks to New Opportunities

Spruce's decision to restructure follows a tumultuous period marked by clinical trial failures. The company's lead candidate, tildacerfont, a CRF1 receptor antagonist, failed two Phase 2 trials for congenital adrenal hyperplasia in 2024. These setbacks led to the termination of the tildacerfont program, which had been Spruce's only asset.

In response to these challenges, Spruce has pivoted its strategy. The company recently licensed an enzyme replacement therapy targeting Sanfilippo syndrome type B, a rare genetic disorder. This ex-BioMarin program, which had previously stalled under the ownership of Allievex, is now the cornerstone of Spruce's revised clinical development plans.

Accelerated Approval Strategy

Spruce Biosciences is betting on a shift in the FDA's stance regarding surrogate endpoints for rare diseases. The company plans to file for accelerated approval of its newly acquired drug candidate in the first half of 2026. This strategy is bolstered by recent regulatory developments that have opened similar pathways for companies like Ultragenyx and Denali Therapeutics in related indications.

The biotech's decision to pursue this route is not without challenges. With $38.8 million in cash and cash equivalents at the end of 2024, Spruce will need to secure additional funding to support its accelerated approval plans. The company states that its current financial position will fund operations through 2025, but further capital will be required to execute its ambitious regulatory strategy.