Fate Cuts Workforce by 40 percent as Collaboration with Jannsen Is Terminated
January 6, 2023
Fate Therapeutics said it will eliminate 220 jobs, a 40 percent reduction from its headcount at the end of September, as the company announced the termination of its collaboration with Janssen Biotech.
The company said it had rejected a proposal from Janssen for continuation of the collaboration and option agreement between the two companies on revised terms and conditions, which lead to its termination. All collaboration activities will be wound down in the first quarter of 2023.
Shares in Fate fell more than 60 percent on the news to $4.17 in mid-day trading.
“We are disappointed that we were not able to align with Janssen on their proposal for continuation of our collaboration, where two product candidates targeting high-value, clinically-validated hematology antigens were set to enter clinical development in 2023,” said Scott Wolchko, president and CEO of Fate Therapeutics. “As a consequence, in keeping with the company’s commitment to develop disruptive product candidates, programs, and technologies with the potential to address large, unmet clinical needs, we have prioritized our clinical programs and substantially reduced operating expenses, including taking the difficult and painful step of reducing our workforce, to ensure that we have a three-year cash runway.”
The company said it has completed a strategic review of its natural killer cell product pipeline and will focus on advancing its most innovative and differentiated programs. The company ended the fourth quarter with approximately $475 million in cash, cash equivalents, and receivables. Based on its pipeline prioritization and expense reduction, the company expects to have sufficient financial resources through the end of 2025 to capitalize on its iPSC-derived chimeric antigen receptor (CAR) NK and CAR T-cell programs.
Author: Rare Daily Staff
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