Epirus Biopharmaceuticals Inc (NASDAQ: EPRS) is going through tough times that have triggered painful austerity measures. The company recently announced plans to purge nearly 40% of its workforce and suspend work on a key drug program. A massive share dilution could also be in the offing as management struggles to raise funds to keep the business afloat.
In a recent regulatory filing, Epirus Biopharmaceuticals Inc (NASDAQ: EPRS) talked about the need for a material equity capital financing as it nears an acute cash shortage. Management disclosed in the filing that even with the staff layoff and wind down of the lead drug candidate program, the available cash and any savings could only last it through 2Q2016.
To lower its cash burn, Epirus is in the process of cutting some 29 positions, a move that will see its workforce population drop by 40%. The management estimates that staff reduction and other belt-tightening measures would lead to long-term savings of $72 million.
On the issue of suspending work on the biosimilar version of Remicade by Johnson & Johnson (NYSE: JNJ), management termed it as a pipeline reprioritization. By putting the development of Remicade copycat on ice, Epirus will give its drug development priority to biosimilars for rare diseases. In particular, management said the focus will shift to creating copycat for Alexion Pharmaceuticals, Inc. (NASDAQ: ALXN)’s Soliris, a drug for a rare blood disorder. The other program will be on copycat of Genentech’s Actemra, a treatment for Castleman’s disease.
As Epirus Biopharmaceuticals Inc. (NASDAQ: EPRS) announced the pipeline reorganization, it also said that its CEO, Amit Munshi, had stepped down. Epirus said it will be promoting current board member Scott Rocklage to replace Munshi. Rocklage has been on the board of Epirus since 2014.
Epirus Biopharmaceuticals Inc. (NASDAQ: EPRS) said it had cash and equivalents totaling $31.5 million at the end of the December quarter and revenue of $0.41 million. As such, the company is losing money faster than it is able to replace it.