Exicure, Inc. Announces Results of Internal Investigation and Implementation of Strategic Measures to Reduce Cash Burn and Prioritize Pipeline Focus
December 10 2021 - 5:36PM
Business Wire
– Exicure will reduce its workforce by
approximately 50%, along with the implementation of other
cost-cutting measures –
– Company to wind down immuno-oncology program
cavrotolimod (AST-008) and XCUR-FXN preclinical program for the
treatment of Friedreich’s ataxia –
– Company will align its R&D resources to
support the development of its preclinical programs targeting SCN9A
for pain as well as its partnered programs –
– Brian C. Bock appointed President and Chief
Executive Officer –
Exicure, Inc.® (NASDAQ: XCUR) announced the results of its
previously disclosed independent internal investigation and a
number of strategic actions aimed to reduce cash spend and
prioritize the Company’s therapeutic pipeline.
The Audit Committee of the Board of Directors of the Company
(the “Audit Committee”) today announced the findings of the
internal investigation initiated and overseen by the Audit
Committee and conducted by outside counsel in connection with
alleged improprieties that Grant Corbett, Ph.D., the Company’s
former Group Lead of Neuroscience, claimed to have committed with
respect to the Company’s XCUR-FXN preclinical program.
The results of the investigation are summarized below.
- Beginning in the autumn of 2020, Dr. Corbett misreported raw
data from certain research and development experiments related to
XCUR-FXN;
- Dr. Corbett misreported the results of at least three different
experiments that were conducted through at least February
2021;
- The misreported data related solely to efficacy rather than
safety of XCUR-FXN;
- The misreported data was included in various public
presentations and SEC filings from as early as January 7, 2021
through as late as August 12, 2021;
- Dr. Corbett acted alone in misreporting the data, without the
assistance or knowledge of anyone else at the Company, including
Company management and other research and development employees and
did not inform anyone at the Company of his actions until his
resignation in November 2021;
- Company management reasonably relied on Dr. Corbett’s analysis
when making public statements that included Dr. Corbett’s
misreported data; and
- No other Company program was impacted by Dr. Corbett’s
misreporting of the XCUR-FXN data.
After a review of the Audit Committee’s findings from the
investigation and in combination with a previously initiated
strategic review of the Company’s business plans and objectives and
its existing cash resources, the Company’s Board of Directors has
implemented the following approved plan:
- A staggered workforce reduction of approximately 50%, expected
to be completed by January 2022;
- Discontinuation of further enrollment and the ethical wind down
of the Company’s ongoing Phase 1b/2 cavrotolimod (AST-008) clinical
trial in patients with solid tumors
- Indefinite suspension of further development of the Company’s
XCUR-FXN program for the treatment of Friedreich’s ataxia
- Restructuring and realignment of the Company’s executive team
as follows, effective today:
- Brian C. Bock, the Company’s former Chief Financial Officer,
has been appointed as the Company’s President and Chief Executive
Officer, replacing David Giljohann, and was appointed as a member
of the Board.
- Dr. David Giljohann, the Company’s former Chief Executive
Officer, has resigned from the Board and will serve as Chief
Technology Officer through January 31, 2022.
- Matthias Schroff, the Company’s former Chief Operating Officer,
has assumed the new role of Chief Scientific Officer;
- Sarah Longoria, the Company’s former Vice President of Human
Resources has been appointed as the Company’s Chief Human Resources
Officer and Chief Compliance Officer; and
- Douglas Feltner, M.D., the Company’s Chief Medical Officer, has
agreed to assist in the wind down of the cavrotolimod and XCUR-FXN
programs and will depart the Company on January 31, 2022.
Exicure expects to realize approximately $6.0 million in
employee related cost savings in 2022, plus additional costs
relating to the elimination of the cavrotolimod and XCUR-FXN
programs. The Company estimates that it will incur total expenses
relating to the restructuring of approximately $1.2 million,
consisting of severance and termination-related costs and expects
to record a significant portion of these charges in the fourth
quarter of 2021.
The Company intends to align its research and development
resources to support (i) the development of its preclinical program
targeting SCN9A for neuropathic pain, (ii) the continued
advancement of its partnered programs with Ipsen Biopharm Limited
to develop SNA-based treatments in neuroscience targeting
Huntington’s disease and Angelman syndrome, (iii) its continued
advancement of its partnered program with AbbVie to develop
SNA-based treatments for hair loss disorders, as well as (iv) the
continued research and development of other undisclosed therapeutic
product candidates.
The Company also announced a prepayment of $10.0 million of its
outstanding loans under its senior secured term loan debt facility
with MidCap Financial Trust, as agent, and Silicon Valley Bank
(SVB), leaving a remaining outstanding balance of $7.5 million,
which will remain subject to the existing terms under the loan
facility.
“This has been a difficult time for all of our stakeholders and
Exicure employees. I want to first thank the employees impacted by
our workforce reduction for their significant contributions in
pursuing treatments for patients with unmet medical needs and wish
them success in their future endeavors. Although this unfortunate
event will have residual effects, I strongly believe there is great
value to be unlocked at Exicure with our proprietary Spherical
Nucleic Acid (SNA) technology, and I look forward to advancing our
promising programs in pain and other neuroscience diseases and
continuing to closely work with our partners to develop innovative
therapies for the treatment of genetic disorders,” stated Brian
Bock, President and Chief Executive Officer, Exicure.
“On behalf of the Board of Directors, I want to thank David
Giljohann for his discoveries and contributions to the development
of our proprietary SNA architecture, commitment in building Exicure
from the ground up and leadership during his time at the Company,”
said Tim Walbert, Chairman of the Board, Exicure. “We look forward
to working closely with Brian Bock as he assumes leadership of the
Company. The Board believes Brian’s disciplined approach as well as
his financial and investment banking background make him well
suited to develop the new strategic path for Exicure and navigate
the Company through the next phase in the Company’s evolution.”
About Exicure, Inc.
Exicure, Inc. is a development-stage biotechnology company
developing therapeutics for neurology and other genetic disorders
based on its proprietary Spherical Nucleic Acid, or SNA,
technology. Exicure believes that its proprietary SNA architecture
has distinct chemical and biological properties that may provide
advantages over other nucleic acid therapeutics and may have
therapeutic potential to target diseases not typically addressed
with other nucleic acid therapeutics.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, as amended. All statements in this press release other than
statements of historical fact could be deemed forward looking
including, but not limited to, statements regarding the benefits of
the proposed restructuring program; the anticipated timing and
details of the reduction in workforce; expected charges and costs
associated with the reduction in workforce that the Company expects
to incur in the fourth quarter of 2021; statements regarding the
internal investigation conducted by the Audit Committee; the
Company’s expectations with respect to the alignment of the
Company’s R&D resources and the further development of its
preclinical program pipeline; the wind down of its cavrotolimod
(AST-008) program and XCUR-FXN preclinical program for the
treatment of Friedreich’s ataxia, including the estimated timing
and cost savings; the proposed benefits of any of the Company’s
partnered programs; and the Company’s business plans and
objectives. Words such as “plans,” “expects,” “will,”
“anticipates,” “continue,” “expand,” “advance,” “develop”
“believes,” “guidance,” “target,” “may,” “remain,” “project,”
“outlook,” “intend,” “estimate,” “could,” “should,” and other words
and terms of similar meaning and expression are intended to
identify forward-looking statements, although not all
forward-looking statements contain such terms. The forward-looking
statements in this press release speak only as of the date of this
press release, and the Company undertakes no obligation to update
these forward-looking statements. Forward-looking statements are
based on management’s current beliefs and assumptions that are
subject to risks and uncertainties and are not guarantees of future
performance. Actual results could differ materially from those
contained in any forward-looking statement as a result of various
factors, including, without limitation: the risks that the ongoing
COVID-19 pandemic may disrupt the Company’s business and/or the
global healthcare system (including its supply chain) more severely
than it has to date or more severely than anticipated; unexpected
costs, charges or expenses that reduce the Company’s capital
resources; the Company’s preclinical or clinical programs do not
advance or result in approved products on a timely or cost
effective basis or at all; the cost, timing and results of clinical
trials; that many drug candidates do not become approved drugs on a
timely or cost effective basis or at all; the ability to enroll
patients in clinical trials; possible safety and efficacy concerns;
risks that preliminary results from preclinical studies and
clinical trials are not necessarily predictive of future results;
the ability of the Company to collaborate successfully with
strategic partners; regulatory developments; exposure to
litigation, including patent litigation, and/or regulatory actions;
the ability of the Company to protect its intellectual property
rights; the impact of the completion of the Company’s internal
investigation and review, including any related investigations or
proceedings, shareholder lawsuits, reputational harm, or the
possibility that executives or other employees may resign or be
terminated. Given these risks and uncertainties, you are cautioned
not to place undue reliance on such forward-looking statements. For
a discussion of other risks and uncertainties, and other important
factors, any of which could cause the Company’s actual results to
differ from those contained in the forward-looking statements, see
the section titled “Risk Factors” in the Company’s Quarterly Report
on Form 10-Q filed with the SEC on November 19, 2021, as updated by
the Company’s subsequent filings with the Securities and Exchange
Commission. All information in this press release is as of the date
of the release, and the Company undertakes no duty to update this
information or to publicly announce the results of any revisions to
any of such statements to reflect future events or developments,
except as required by law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211210005561/en/
Karen Sharma MacDougall 781-235-3060 ksharma@macbiocom.com
Exicure (NASDAQ:XCUR)
Historical Stock Chart
From Jun 2024 to Jul 2024
Exicure (NASDAQ:XCUR)
Historical Stock Chart
From Jul 2023 to Jul 2024