Vir Biotechnology Q2 2024 Financial Results and Strategic Restructuring Announced

Vir Biotechnology, Inc. (Nasdaq: VIR) released a corporate update and financial results for the second quarter ending June 30, 2024. 

Marianne De Backer, Vir's CEO, highlighted the promising preliminary results from the SOLSTICE Phase 2 study, showcasing significant progress in addressing chronic hepatitis delta infection. The FDA recently cleared an Investigational New Drug (IND) application and granted Fast Track designation for tobevibart and elebsiran, underlining the company's focus on advancing treatments for this severe condition. 

The SOLSTICE study results were presented at the European Association for the Study of the Liver (EASL) Congress 2024. Tobevibart, both as a monotherapy and in combination with elebsiran, showed high virologic response and ALT normalization in hepatitis delta patients after 12 and 24 weeks of treatment. Full data from the 24-week treatment on approximately 60 participants is expected in the fourth quarter of 2024. 

Vir's chronic hepatitis B (CHB) program is also progressing, with the Phase 2 MARCH Part B study fully enrolled. Data from this study, evaluating the combination of tobevibart and elebsiran with peginterferon alpha, is expected by the end of 2024. Initial data from the Phase 2 PREVAIL platform study, assessing combinations of tobevibart, elebsiran, and peginterferon alpha in different patient populations, is anticipated in the first half of 2025.

A strategic restructuring is underway at Vir to streamline operations and focus on high-value opportunities. This includes phasing out influenza, COVID-19, and T cell-based viral vector programs, resulting in a 25% workforce reduction. By the end of 2024, the company expects to have approximately 435 employees, down from its peak headcount in the second quarter of 2023. These changes are expected to save around $50 million annually starting in 2025 and $50 million through the end of 2025 from discontinued programs. Restructuring costs are estimated between $11 million and $13 million and will primarily cover employee severance.

Vir has signed an exclusive worldwide license agreement with Sanofi for multiple clinical-stage T-cell engagers and a protease-cleavable masking platform. This agreement is contingent upon the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Act Antitrust Improvements Act of 1976.

In corporate developments, Vir appointed Mark D. Eisner, M.D., M.P.H. as Executive Vice President and Chief Medical Officer, effective June 3, 2024. Additionally, founding board members Phillip Sharp, Ph.D., and Robert Perez stepped down, with Norbert Bischofberger, Ph.D., and Ramy Farid, Ph.D., elected as new independent directors.

For the second quarter of 2024, Vir reported approximately $1.43 billion in cash, cash equivalents, and investments, a decline of $78 million from the previous quarter. Total revenues for the quarter were $3.1 million, compared to $3.8 million for the same period in 2023. Research and development expenses decreased to $105.1 million from $168.1 million in 2023, primarily due to lower clinical and manufacturing costs. Selling, general, and administrative expenses also decreased to $30.3 million from $45.5 million in 2023.

Restructuring and related charges increased to $26.3 million from $5.4 million in the previous year, mainly due to impairment charges from closing a facility in St. Louis, Missouri. Other income was $18.7 million, up from $17.6 million in 2023. The net loss for the quarter was $138.4 million or $1.02 per share, compared to a net loss of $194.8 million or $1.45 per share in 2023.

Looking ahead, Vir lowered its operating expense guidance for the full year 2024 due to workforce restructuring and the discontinuation of certain programs. The revised guidance does not include the impact of the upfront and escrowed milestone payments from the Sanofi agreement. The company will update its guidance in the third quarter of 2024.

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