By Sriparna Roy
(Reuters) -BioXcel Therapeutics Inc said on Monday it will cut more than half of its workforce, as the drugmaker shifts its focus towards developing its agitation treatment for use in at-home settings, sending shares down about 46%.
The drugmaker said it was taking a three-step approach to restructure its business, including prioritizing development of its drug BXCL501 and reducing marketing expenses.
BXCL501 is being evaluated for use in retail and outpatient settings for treatment of acute agitation related to schizophrenia, bipolar disorders and in patients with mild-to-moderate dementia due to Alzheimer's disease.
Sold under the brand name Igalmi, the drug is approved in the U.S. for use in hospital settings to treat agitation in adult patients with schizophrenia or bipolar disorder.
The company said it will reduce marketing expenses related to Igalmi, after a slower-than-expected demand in hospital settings.
"This summer has not progressed as we had anticipated," said CEO Vimal Mehta on a conference call.
BioXcel is pausing the development of the drug as an additional treatment for major depressive disorder and is considering a sale of its oncology-focused private unit.
In the absence of additional funding, BioXcel expects its current cash resources of $127.5 million to last through mid-2024, compared with its previous forecast of 2025.
With the job cuts, BioXcel aims to reduce more than 50% of its cash burn to about $80 million annually, going forward.
In June, BioXcel had flagged issues with recording of safety data at a site where a late-stage trial of the drug for treatment of agitation in Alzheimer's patients was being conducted. The company said an external audit was ongoing and an update can be expected by the end of the year.
BioXcel also plans to provide an update on its research pipeline later this year, which includes early-stage chronic agitation treatment BXCL502.