Rocket Pharmaceuticals Restructures, Narrows Pipeline Focus Amid Setbacks

Rocket Pharmaceuticals, a biotechnology company specializing in gene therapies, has announced a significant restructuring of its operations and pipeline focus. The move comes in response to recent setbacks and aims to extend the company's cash runway.

Layoffs and Pipeline Prioritization

Rocket has revealed plans to reduce its workforce by 30%, affecting approximately 80 employees. The layoffs, which began on Wednesday, are expected to be completed by August 8. The company anticipates incurring costs of $3.5 million, primarily from severance payments.

In conjunction with the staff reduction, Rocket is narrowing its pipeline focus. The company will prioritize its cardiovascular disease programs, including treatments for Danon disease and two forms of cardiomyopathy. This shift comes at the expense of certain hematology assets, which will face delays or deprioritization.

Setbacks and Regulatory Challenges

The restructuring follows a significant setback in May when a participant in Rocket's pivotal Danon disease gene therapy trial died, prompting the FDA to place a clinical hold on the study. This event has led to a strategic review of the company's operations and pipeline.

Additionally, Rocket's leukocyte adhesion deficiency-I gene therapy, Kresladi, faced a setback last year when the FDA rejected its approval request, citing the need for additional manufacturing information. The company has allocated resources to address the complete response letter and plans to resubmit its application.

Financial Implications and Future Outlook

Through these strategic changes, Rocket aims to extend its cash runway into the second quarter of 2027, a significant improvement from the previous projection of late 2026. The company has not factored in the potential sale of a priority review voucher for Kresladi, which could provide additional financial resources if approved.

While Rocket's restructuring efforts are designed to strengthen its long-term position, the immediate impact includes delays to key programs. Notably, the company has abandoned its goal of securing FDA approval for RP-L102 in Fanconi anemia next year, and delays are expected for its pyruvate kinase deficiency program RP-L301.