Exicure’s significant layoffs and recent shelving of research activities haven’t yet attracted a transaction to save the remainder of the business. The biotech’s recently appointed joint CEO and chief financial officer is now stepping up to find a solution.
Jung-Sang (Michael) Kim took on the dual roles April 27 as CEO Matthias Schroff, Ph.D., and CFO Elias Papadimas stepped down along with the board’s chair Seung Soo Shin. The C-suite shake-up came in the wake of a year that saw the ribonucleic-acid-focused biotech cut staff by half in January 2022 and then again by 66% in September as well as shelving all research activities including partnered programs and kicking off work to offload preclinical programs at the same time.
With Kim now established in his dual roles, the company announced May 26 that it “fully supports” the CEO’s “strategic vision” and his “ongoing efforts to maximize shareholder value.” Those efforts sound pretty similar to the plan set out by the company in March, namely to “identify and evaluate a range of potential strategic transaction alternatives, including transactions involving industries and businesses unrelated to our historical operations.”
“These efforts include the possible sale of certain of the company’s assets, as well as exploring growth through transactions with potential partners that see opportunity in joining an existing, publicly-traded organization,” the biotech added in the release.
When Exicure says it’s willing to look at transactions in unrelated business areas, it’s not kidding. So far, the company has made one such move that ties into that strategy—buying $1 million in convertible bonds in the Korean social media platform Cyworld at the start of May.
But in a sign that salvation for the company remains a distant dream, the company added that there is no assurance that the ongoing review of options led by Kim will result in a transaction. The clock is ticking—earlier this month, the biotech revealed that Nasdaq has threatened delisting after its stock sunk below the required $1 per share mark.
Exicure’s woes date back to fall 2021, when an internal review by the board concluded that former neuroscience group leader Grant Corbett, Ph.D., had misreported data on a preclinical program. As a result, the Friedreich’s ataxia program was axed, leaving the biotech reliant on a few Big Pharma collaborations and a new lead asset, SCN9A. Things only got worse for the company when AbbVie and Ipsen walked away at the end of 2022 and SCN9A failed preclinical studies in nonhuman primates.