Athira lays off 70% of staff, shifts focus to ALS small molecule

Athira Pharma has encountered numerous challenges in recent years, prompting the company to implement significant changes to sustain its operations. Recently, the company revealed that its Alzheimer’s disease treatment candidate, fosgonimeton, did not outperform a placebo in a phase 2/3 clinical trial. In response, Athira is laying off 70% of its workforce and making major leadership changes.

Athira is now redirecting its efforts towards ATH-1105, an oral small molecule intended for amyotrophic lateral sclerosis (ALS). According to Athira's President and CEO, Mark Litton, Ph.D., ATH-1105 shows promise due to its enhanced penetration of the blood-brain barrier and improved pharmacokinetic properties. The company aims to capitalize on these features to develop a potentially effective ALS treatment.

The layoffs will impact approximately 49 employees and are expected to cost Athira around $2.8 million in the short term. However, the company anticipates annual savings of about $13.4 million as a result. These cost-cutting measures are projected to extend Athira’s financial runway until the first quarter of 2026.

In addition to the staff reductions, Athira is undergoing a leadership reshuffle. Effective October 1, Andrew Gengos, the chief business officer and chief financial officer, along with Rachel Lenington, the chief operating officer and chief development officer, will be leaving the company. Robert Renninger, the current vice president of finance, will assume the roles of principal financial officer and principal accounting officer.

The company has faced scrutiny in the past, notably in 2021 when former CEO Leen Kawas, Ph.D., was accused of altering images in several research papers from her time at Washington State University. Kawas was subsequently dismissed and Mark Litton took over the CEO position.

Earlier this year, Athira shared preclinical data indicating that ATH-1105 could reduce pathological protein accumulation in the sciatic nerve of mice with ALS. The company is now progressing with a first-in-human phase 1 trial for ATH-1105, with plans to start dosing ALS patients by early 2025. The biotech firm, based in Washington, is hopeful that this new focus will lead to successful outcomes in their ALS research and development efforts.