Mereo BioPharma Cuts Staff, Focuses on Pushing Rare Disease Programs Through Clinic

Rare disease and oncology focused biotech Mereo BioPharma said it will cut staff by 40 percent to extend its cash runway into 2026.

Photo: Denise Scots-Knight, CEO of Mereo

Mereo will focus on advancing its two core rare disease programs and to generate value from its assets. Lead pipeline candidate setrusumab is currently being studied in an ongoing phase 2/3 registrational trial in patients aged 5-25 with the rare bone disease osteogenesis imperfecta that is being conducted by its partner, Ultragenyx.

 A protocol amendment for the phase 2 part of the study removes the placebo arm and continues evaluating the same two dose levels of setrusumab as in the original protocol. This amendment has been submitted to the U.S. Food and Drug Administration and is now subject to approval by the site-specific Institutional Review Boards. Ultragenyx currently expects to complete enrollment in this portion of the study in the next few months, and to transition to the phase 3 portion in the first half of 2023. Further, Ultragenyx plans to initiate a pediatric study in patients with osteogenesis imperfecta aged 2 to less than 5 years, also in the first half of 2023. This program will remain the main focus of Mereo’s capital resources.

Mereo will provide an update on its second candidate alvelestat for the treatment of alpha-1-anti-trypsin deficiency (AATD) at the end of October.

With a targeted reduction in the employee base of up to 40 percent and a significant reduction in other costs, the company will operate at what it believes to be the minimum level of resources currently required to continue executing on its strategy while remaining publicly listed.

As of June 30, 2022, Mereo had approximately $85.5 million (£76 million) in cash on hand. As a result of these actions, the company’s cash runway will extend into 2026 from its previous guidance of into the second quarter of 2025.

“Our revised operating plan seeks to retain key personnel and conserve shareholder capital as we work to maximize the value of our promising rare disease programs for our shareholders, who share our conviction in these assets and their potential to create positive outcomes for patients and their families,” said Denise Scots-Knight, CEO of Mereo. “With the changes Ultragenyx has made to the setrusumab development plan, the recent Fast Track designation for alvelestat for AATD and important milestones for our two core programs approaching over the next year or so, we believe this revised plan successfully positions Mereo for the future.”

Author: Rare Daily Staff