Spruce Biosciences has swept away 55% of its employees. The biotech took the action days after inking a deal for a former BioMarin rare disease candidate that it plans to file for a speedy approval next year.
California-based Spruce has had a tough time of it. The biotech was rocked last year by the failure of the CRF1 receptor antagonist tildacerfont when it flunked a phase 2 congenital adrenal hyperplasia trial back in March 2024, prompting the biotech to lay off 21% of its workforce.
The pain deepened when tildacerfont failed another phase 2 hyperplasia trial in December. Shaken by back-to-back flops, Spruce axed tildacerfont, its only asset, and began weighing up its dwindling options.
The biotech revealed its new strategy two weeks ago. Aiming to capitalize on a shift in the FDA’s position, Spruce licensed an enzyme replacement therapy for use in the genetic disease Sanfilippo syndrome type B. The ex-BioMarin program stuttered at Allievex, its former owner, but Spruce sees a path to market.
Spruce is resizing its team to align with its plan to seek accelerated approval for the drug candidate. The 55% workforce reduction is effective immediately, the biotech said after the stock market closed Friday, with a termination date of May 2 for affected individuals. Spruce ended last year with 21 employees.
The biotech expects the layoffs to cost it almost $1 million. Spruce ended last year with $38.8 million in cash and cash equivalents, a sum it said will fund operations through this year. The biotech will need to find money to execute its plan to seek accelerated approval in the first half of next year.
Spruce’s belief the FDA will consider granting accelerated approval on the strength of its existing results is based on a shift in the agency’s stance on a surrogate endpoint. The shift opened the door to filings by Ultragenyx and Denali Therapeutics in related indications.