Aerovate cuts workforce after Phase IIb trial failure

Aerovate Therapeutics is undergoing a significant reduction in its workforce following the unsuccessful outcome of a key clinical trial for its pulmonary arterial hypertension (PAH) drug, AV-101. The Massachusetts-based biotechnology company announced a 78% workforce cut in an official SEC filing. The reduction is expected to incur costs of approximately $5.6 million, which will be accounted for in the third and fourth quarters of 2024. All employees are anticipated to be laid off in the coming months.

The announcement comes on the heels of Aerovate's decision to halt its Phase II/III IMPAHCT trial (NCT05036135) on June 17. The Phase IIb segment of the trial did not meet its primary endpoint of improving PAH compared to a placebo across any studied doses. Additionally, AV-101, an inhaled formulation of the drug imatinib, failed to demonstrate significant improvements in the secondary endpoint, which measured changes in six-minute walk distance. As a consequence, the Phase III and long-term extension components of the study (NCT05557942) were also terminated. Following this news, Aerovate’s stock price plummeted by more than 90%.

Pulmonary arterial hypertension is a medical condition characterized by high blood pressure in the arteries that supply the lungs, which can lead to heart strain and reduced oxygen levels in the body. Over the past year, competition in the PAH market has intensified. Notably, MSD’s Winrevair (sotatercept-csrk) and Johnson & Johnson’s Opsynvi—a combination of Adcirca (tadalafil) and Opsumit (macitentan)—both received approval from the US Food and Drug Administration (FDA) in March 2024.

Imatinib, the active component in AV-101, is a small molecule tyrosine kinase inhibitor (TKI) that blocks receptor activation by binding to the ATP-binding pocket necessary for signaling. Marketed by Novartis as Gleevec, imatinib is available as a generic treatment mainly used in oncology. While oral imatinib has demonstrated efficacy in PAH patients, its tolerability has been an issue. To address this, AV-101 was developed as a dry powder inhaled formulation, designed to reduce systemic exposure by delivering the drug directly to the lungs.

Aerovate Therapeutics was launched in 2020, backed by a $72.6 million Series A funding round led by Sofinnova Investments. This funding was intended to advance the clinical trials for AV-101, which was the company's lead and only clinical candidate.

In summary, the failure of AV-101 in its Phase IIb trial has led to a drastic reduction in Aerovate Therapeutics' workforce and halted further clinical development of the drug. This setback highlights the competitive and challenging nature of advancing new treatments in the PAH market.

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