The incessant pace of biotech layoffs continues unabated, with G1 Therapeutics disclosing significant cuts to its staff and Sorrento filing a notice that more than 500 jobs could be on the line.
The latest pair of announcements is indicative of an unrelenting cratering of the biotech workforce marked by nearly 40 companies revealing head count reductions so far this year. Through the first two months of 2023, 38 drug developers laid off staff, according to the Fierce Biotech Layoff Tracker, nearly triple the number over the same period in 2022.
For G1 Therapeutics, the reasons for the layoffs fit an all-too-familiar pattern for biotechs. That is to say, the company is shrinking by 30% to save money for trial readouts, although it noted that the sales team behind its FDA-approved myeloprotection therapy Cosela remains intact.
The cancer-focused company says that the reduction in staff combined with other cost-saving measures could lower costs this year by up to 30% compared to 2022. The belt-tightening should also allow G1 to operate through all upcoming readouts of Cosela in other indications.
As of the end of the year, G1 reported having just over $140 million on hand, down from $221 million at the end of 2021. Total Cosela revenue for the year eclipsed $51 million, up nearly $20 million from 2021.
Sorrento, meanwhile, filed a Worker Adjustment and Retraining Notification notice in California, stating that 538 positions could be cut. The company, however, confirmed in a statement to Fierce Biotech that no layoffs have occurred at this time. The WARN notice was issued prior to the securing of a $75 million financing. “Sorrento is currently evaluating its staffing needs in order to continue driving forward its priority trials,” the spokesperson said.
Sorrento filed for bankruptcy two weeks ago, with the company revealing $235 million in debt. Sorrento has been in a yearslong legal feud with billionaire drug developer Patrick Soon-Shiong, M.D., and his companies over an alleged scheme to run out the clock on a Sorrento asset bought by Soon-Shiong’s company NantCell. Sorrento was handed a lifeline a week after the bankruptcy notice, however, with a Texas court approving a $75 million loan from JMB Capital Partners.
As part of the financing, Sorrento CEO Henry Ji, Ph.D., indicated that the money would be spent continuing “normal business operations, including the payment of employee wages and benefits and post-petition vendor obligations.”