Apellis Announces Corporate Restructuring and Workforce Reduction
Apellis Pharmaceuticals announced a corporate restructuring that it says will cut costs and position the company for long-term success.
As part of the restructuring, Apellis said it is reducing headcount by approximately 225 employees, or about 25% of the current workforce across the organization. Field-based commercial and medical employees will be minimally affected, the company stated in a news release, with the planned workforce reduction anticipated to be 'substantially completed' in the third quarter of 2023. Apellis expects these actions to result in total cost savings of up to $300 million through 2024, which includes more than $70 million in expected net cost savings related to the workforce reduction and up to $230 million related to the elimination of planned external expenses.
Apellis received FDA approval for Syfovre, a targeted C3 therapy, in February, becoming the first FDA approved drug for geopgraphic atrophy (GA). However, in July, a notification from the ASRS Research and Safety in Therapeutics (ReST) Committee alerted members to rare cases of retinal vasculitis that occurred after the first injection of Syfovre. Last week, shares of the Apellis rebounded after the company identified a potential cause of the rare events of retinal vasculitis reported in real-world use of Syfovre. Apellis said 'internal structural variations' were identified in the specific 19-gauge by 1½ inch filter needle included in certain injection kits.
Apellis said it remains focused on supporting the continued strong US commercial launch of Syfovre and is preparing for potential ex-U.S. launches, with an anticipated decision on regulatory approval by the European Medicines Agency (EMA) in early 2024. In the first half of 2023, Syfovre generated $85.7 million in US net product revenues and the company delivered more than 50,000 vials to physician practices, including commercial vials shipped and sample vials distributed. On August 22, the company reported that over 26,000 vials had been distributed in the third quarter.
Apellis is preparing to launch Syfovre in the EU, prioritizing an initial launch in Germany. Marketing applications for intravitreal pegcetacoplan are also under review in Canada, Australia, the United Kingdom and Switzerland, with decisions expected in the first half of 2024.
The restructuring is also expected to streamline the company's Empaveli (pegcetacoplan) business. Empaveli is a prescription medicine used to treat adults with paroxysmal nocturnal hemoglobinuria (PNH). The plan will reduce Empaveli-related expenses through a more focused commercial and medical PNH organization. In the first half of 2023, Empaveli generated $42.7 million in U.S. net product revenues. More than 230 people in the U.S. with PNH were on commercial treatment as of June 30, 2023.
Apellis said it is prioritizing research initiatives, including focusing research initiatives on high-potential opportunities in retina and central nervous system (CNS) diseases, and deprioritizing certain development initiatives (including siRNA with systemic pegcetacoplan, APL-1030, and APL-2006).
“We are taking important actions to strengthen our ability to invest in growth opportunities and support the company's long-term success, including maximizing the significant opportunity with Syfovre. As a more focused organization, we believe these initiatives put Apellis in a stronger position to create value for shareholders and continue delivering on our mission for patients now and in the future," Cedric Francois, MD, PhD, co-founder and chief executive officer of Apellis, said in a company news release. “These were difficult, but necessary, decisions. We are thankful for the commitment and contributions of our colleagues who have worked relentlessly to advance life-changing medicines for some of the most challenging diseases patients face. As we move forward, we are committed to supporting our teammates throughout this process.”