End of the road for Evelo as no “viable alternative” found

22 Nov 2023
firstwordpharma.com
Phase 2Clinical ResultClinical Trial Failure
Evelo Biosciences disclosed in a filing with the US Securities and Exchange Commission that it will dissolve the business after failing to find a “viable alternative.” The company began exploring its options last month after announcing the second setback this year for one of its experimental drugs.
The most recent study failure involved EDP2939, which fared worse than placebo at alleviating psoriasis symptoms in a Phase II trial. Specifically, at the 16-week mark of the study, 19.6% of patients on EDP2939 versus 25% of those on placebo achieved the primary endpoint of at least a 50% improvement from baseline in Psoriasis Area and Severity Index (PASI 50).
Earlier in the year, Evelo ended further development of EDP1815 in atopic dermatitis after winding down a Phase II study of the drug. In the trial, 37.9% of those on EDP1815 achieved the primary endpoint of at least a 50% improvement from baseline in Eczema Area and Severity Index (EASI) score, versus 44.7% in the placebo arm.
Sought partner
Shortly after the EDP2939 failure, Morgan Stanley analysts noted that Evelo was focused on finding a partner for EDP1815 and its small intestinal axis (SINTAX) platform before the end of 2023. However, they cautioned that the setback for EDP2939 would make it difficult for the company “to obtain a partnership with attractive economic terms in the near term.”
Evelo said that the dissolution comes after it sought potential funding sources and other ways to continue to operate its business. The company – which was founded by Flagship Ventures in 2014 – suggested that winding down operations “presents the best opportunity for recovery for…creditors and may also provide an opportunity for future payments to its other stakeholders.”
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