Calif. biotech company lays off almost half of staff after 78% stock drop

"While we are disappointed to have narrowly missed the stringent prespecified statistical threshold for our primary endpoint, the result still clears the traditional 0.05 p-value, and we believe these data clearly demonstrate seralutinib is an active drug in patients with PAH."

"The biotech lab began a 77-worker layoff on Monday, cutting its workforce by 48%. Bryan Giraudo, Gossamer's chief financial officer, told SFGATE that the layoffs will help the company's conservation of cash as it meets with the Food and Drug Administration to consider its next steps forward after the research miss."

"In the tumultuous world of biotech, such valuation dives are all too common; in fact, Gossamer once traded above a $1 billion valuation before poor seralutinib study results in late 2022 sent its stock plummeting."

Gossamer Bio announced disappointing results from its flagship pulmonary arterial hypertension study in February, triggering a 78% stock price drop from approximately $490 million to $105 million in valuation. The company subsequently initiated a 77-worker layoff, reducing its workforce by 48%. Most cuts affected clinical development and commercial teams in San Diego and the Bay Area. The study of seralutinib showed the drug beat placebo but narrowly missed the prespecified statistical threshold for the primary endpoint, though it cleared the traditional 0.05 p-value. CEO Faheem Hasnain stated the data demonstrates seralutinib is active in patients with pulmonary arterial hypertension. The company is conserving cash and plans to meet with the FDA regarding next steps.

Read at SFGATE