Mereo BioPharma slashes headcount by 40% to save rare disease programs
Published: Oct 18, 2022
By Alex Keown
London-based Mereo said the new strategy would enable the company to maintain its ability to drive its two core rare-disease programs through near-term development milestones. As of June 30, the company had approximately £76 million (about $86 million) in cash, and the cuts are expected to extend cash runway through 2026.
Following the cuts, Mereo said it would retain key personnel needed to advance the programs. With the announced cuts, Mereo will continue to operate with the minimum level of resources required to execute its strategy while remaining publicly listed.
Shares of Mereo are up slightly in premarket trading to $1.05. The stock closed at $1 per share on Monday.
Denise Scots-Knight, chief executive officer of Mereo, said the company’s plan aims to retain key personnel and, at the same time, conserve shareholder capital. She said the company continues to focus on developing key assets they believe can “create positive outcomes for patients and their families.” Scots-Knight added the plan would position Mereo for the future.
Mereo announced its new strategy the day after the FDA awarded Fast Track designation to the company’s investigational oral neutrophil elastase inhibitor, alvelestat (MPH-966). The company intends to hold an end-of-phase meeting with the regulatory agency to discuss the design of a registrational study for alvelestat as a treatment for AATD-associated lung disease.
Alvelestat previously received Orphan Drug Designation for the treatment of AATD from the FDA.
The designation was awarded after the company posted positive top-line safety and efficacy data from the Phase II ASTRAEUS trial assessing alvelestat in severe AATD-associated emphysema. At the high dose, alvelestat demonstrated statistically significant changes versus placebo in three primary biomarker endpoints associated with AATD-related lung disease (AATD-LD), blood neutrophil elastase activity, Aα-val360 and the elastin breakdown product, desmosine.
Mereo intends to provide additional information about the alvelestat program on Oct. 31
Beyond alvelestat, Mereo’s other lead programs include setrusumab, an investigational treatment for osteogenesis imperfecta and etigilimab, which has been evaluated in combination with Bristol Myers Squibb’s checkpoint inhibitor Opdivo (nivolumab).
Mereo is advancing setrusumab, which inhibits sclerostin proteins, in an ongoing Phase II/III registrational trial in patients between the ages of 5 and 25 diagnosed with osteogenesis imperfecta (OI). The study is being conducted in partnership with Ultragenyx.
The two companies dosed the first patient in this study earlier this year. A study on pediatric patients under five is expected to begin in early 2023.
Etigilimab, an anti-TIGIT, is being evaluated in an ongoing Phase Ib/II study. Currently, 16 patients remain in the program and are responding to therapy.
Mereo is winding down this study due to disease progression. The study will end once all patients have disease progression or have left the study.