Pharmaceutical Industry Roundup: Layoffs, Fundraising, and New Collaborations

Rocket Pharmaceuticals Announces Layoffs and Strategic Focus

Rocket Pharmaceuticals has announced a significant restructuring, including layoffs affecting approximately 30% of its workforce. The gene therapy developer is refocusing its resources on three inherited heart conditions, a move expected to reduce operating expenses by one-quarter. This strategic shift comes in the wake of a Food and Drug Administration (FDA) rejection of Rocket's gene therapy Kresladi last year.

The company anticipates that these cost-cutting measures, combined with existing cash reserves and the potential sale of a regulatory fast pass, will extend its financial runway into the second quarter of 2027. However, Rocket also warned of potential delays in advancing programs for Fanconi anemia and pyruvate kinase deficiency.

Abivax Secures Major Funding Following Positive Clinical Results

In a significant financial development, Abivax has priced a secondary stock offering of American Depositary shares, expecting to raise at least $650 million. This substantial funding round follows the company's recent announcement of promising Phase 3 study results for its ulcerative colitis drug, obefazimod.

If investment banks exercise their options to purchase additional stock, Abivax could potentially raise nearly $750 million, dwarfing its current cash holdings. The company plans to use these funds to extend its operating runway through 2027 and support further testing of obefazimod in inflammatory bowel disease.

New Collaborations: Eli Lilly and Novartis Forge Strategic Partnerships

The pharmaceutical industry has seen a flurry of new collaborations, with major players like Eli Lilly and Novartis striking deals with emerging biotech companies.

Gate Bioscience, a California-based biotechnology company, has entered into a collaboration and licensing agreement with Eli Lilly. The deal includes an upfront payment, equity investment, and potential milestone and royalty payouts, with a total potential value of up to $856 million. Gate Bioscience aims to create "molecular gates," a new class of medicines designed to stop cells from secreting disease-causing proteins.

Meanwhile, Novartis has agreed to pay privately held Matchpoint Therapeutics up to $60 million in upfront and research funding fees. The collaboration focuses on advancing an undisclosed program through preclinical testing, with Novartis holding an option to exclusively license it. Matchpoint specializes in drugs that work by binding covalently to their target and is targeting an unnamed transcription factor involved in inflammatory disease.