BenevolentAI is cutting back its drug development operation in the wake of a midphase flop, laying off up to 180 staff, reducing its lab footprint, pausing some programs and dropping its lead candidate.
The London-based company pitched itself as a new, better type of biotech, namely one with an artificial intelligence platform capable of increasing the likelihood of clinical success. But it has run into the same problems that its peers have faced since the dawn of the industry as preclinical promise has failed to translate into clinical efficacy. Reality hit last month when the biotech’s lead asset failed a phase 2a trial.
Now, having seen its share price fall 79% over the past year, BenevolentAI is rethinking its strategy. The company is restructuring to form two business units: a tech division, which will commercialize AI products including a natural language biomedical querying system, and a drug development wing.
The drug development unit will focus on taking a pipeline led by the PDE10 inhibitor BEN-8744 to value inflection points. BEN-8744, which BenevolentAI sees as an ulcerative colitis therapy, is on track to enter the clinic in the third quarter, a little behind schedule (PDF). The biotech is also aiming to get BEN-28010, a CHK1 inhibitor in development for a brain cancer, IND-ready by the end of the year.
BenevolentAI will continue to invest in some early-stage treatments for amyotrophic lateral sclerosis, Parkinson’s disease and fibrosis but is washing its hands of BEN-2293, the topical pan-Trk inhibitor that failed the midphase eczema trial last month.
Overall, the changes represent a narrowing of focus to the “most advanced and high-potential assets.” BenevolentAI previously outlined a broad R&D strategy, using its annual report to set itself the target of adding between four and six named drug programs this year. As part of the refocusing, BenevolentAI will reduce its lab footprint, pause selected programs and adopt “a strategic outsourcing model.”
The changes will cost up to 180 people their jobs. BenevolentAI said it had 363 permanent employees when it published its annual report earlier this year, suggesting the layoffs represent deep cuts to its operation. BenevolentAI is “retaining key drug discovery and target identification capabilities.”
Through the changes, BenevolentAI expects to reduce its costs by 45 million pounds sterling ($56 million). Most, 32 million pounds, of the savings will come from lower drug programs and staff costs, with facility cuts accounting for the rest. The company expects the lower costs to extend its cash runway to at least July 2025. At the end of last year, the biotech said its cash reserves would keep it going into the fourth quarter of 2024.