Viracta Therapeutics is implementing its second round of layoffs in just three months as the cash-strapped biotech tries to keep funds flowing to its lymphoma program.
Around 42% of the company’s remaining employees will be shown the exit, according to a post-market release Nov. 6, while the company is whittling down the size of its board of directors from 10 seats to six. The goal is to “further align resources” with its lead program, a combination of the HDAC inhibitor nanatinostat and the antiviral valganciclovir.
In August, the biotech posted phase 2 data for the combo, dubbed nana-val, in 21 patients with peripheral T-cell lymphoma (PTCL) whose cancer was Epstein-Barr virus (EBV)-positive. The idea was to induce EBV expression with nanatinostat and the death of lymphoma cells that carry the protein with valganciclovir.
That study saw overall and complete response rates (ORR/CRR) of 33% and 19%, respectively. In the 10 second-line patients, the ORR was 60% and the CRR was 30%. The readout was enough for Viracta to go all-in on the PTCL opportunity, halting work on developing nana-val for solid tumors and laying off around 23% of the company’s employees.
The biotech ended March with 40 full-time employees, meaning, after yesterday’s second round of layoffs, the company is likely to be left with somewhere in the region of 18 staff members.
“The initiatives that we are announcing today will enable us to conserve resources as we efficiently advance our nana-val program towards a potential NDA submission for R/R EBV-positive PTCL, our lead indication,” Viracta CEO Mark Rothera said in the release. “While these actions are necessary, they unfortunately impact our team.”
When it came to downsizing the board, the company said that as well as reducing costs and streamlining operations, this would also “bring the size of Viracta’s board more in line with the boards of other similarly sized companies.”
The biotech ended June with about $30 million in the bank, which the company had previously been expecting to run out by March 2025. The risk of further layoffs was never far away, bearing in mind that Viracta’s plans rely on getting another PTCL study for nana-val off the ground in the second half of 2025 with a goal of seeking accelerated approval in 2026.