Bicycle Therapeutics Announces Layoffs and Restructuring Following Genentech Collaboration Termination

Bicycle Therapeutics, a UK-based biotech company, has unveiled plans for significant workforce reductions and cost-cutting measures in response to the termination of its oncology collaboration with Genentech. The announcement, made during the company's second-quarter earnings report, outlines a strategy to extend Bicycle's cash runway amid changing partnership dynamics.

Workforce Reduction and Financial Restructuring

Bicycle Therapeutics revealed its intention to reduce its workforce by approximately 25%, affecting both current and planned positions across its UK and US operations. This move is part of a broader initiative to cut spending by 30% over the course of its cash runway. The company, which reported 305 employees at the end of the previous year, expects to incur costs of $5.3 million related to severance pay and other charges, primarily in the third quarter of 2025.

The restructuring efforts are projected to yield long-term savings, extending Bicycle's cash runway into 2028, a significant improvement from the previous projection of the second half of 2027. This extension provides the company with additional financial flexibility as it navigates the loss of its collaboration with Genentech.

Genentech Collaboration Termination

The workforce reduction comes on the heels of Genentech's decision to terminate its partnership with Bicycle Therapeutics. Genentech, a subsidiary of Roche, notified Bicycle of the termination in July 2025, with the partnership set to officially conclude in August. As a result of this development, Bicycle anticipates recognizing $6.5 million in remaining deferred revenue from the deal in the third quarter of 2025.

The collaboration, which began in 2020 with a $30 million upfront payment from Genentech, had been a significant source of revenue for Bicycle, contributing $56 million to the company's coffers through the end of June 2025. The partnership had focused on immuno-oncology and included options for Genentech to nominate additional targets. However, the collaboration had been gradually scaled back, with Genentech terminating one project in 2023, halting work on another in 2024, and ending a third at the beginning of 2025.

Strategic Focus on Zelenectide

Despite the setbacks, Bicycle Therapeutics is maintaining its focus on advancing its lead candidate, zelenectide, a Nectin-4 drug for the treatment of metastatic urothelial cancer. The company plans to engage in discussions with the FDA regarding dose selection for a phase 2/3 pivotal trial and explore the potential for an accelerated approval pathway. These talks are scheduled for the fourth quarter of 2025, underscoring Bicycle's commitment to progressing its internal pipeline despite the recent restructuring.