BioXcel to cut over 50% of jobs as it pivots focus to agitation drug

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Shares of BioXcel fell about 36% to $4.75 in premarket trading.

The company said it will prioritize the development of its drug BXCL501, which is being evaluated for use in at-home settings for treatment of agitation related to schizophrenia, bipolar disorders and in patients with mild-to-moderate dementia due to probable Alzheimer’s disease.

In June, the company had flagged issues related to the recording of safety data at a site where a late-stage trial of the drug for treatment of agitation in Alzheimer’s patients was being conducted.

BioXcel, in a conference call on Monday, said it has initiated an external audit for the issue and expects an update by the end of the year.

The drug, sold under the brand name Igalmi in the U.S., is already approved for use in hospital settings to treat agitation in adult patients with schizophrenia or bipolar disorder.

The company plans to reduce in-hospital commercialization expenses, and suspend trials that it no longer deems core to its business.

With the job cuts, BioXcel aims to reduce more than 50% of its cash burn to about $80 million on a go-forward annualized basis. Its cash and cash equivalents totaled to $127.5 million as of June 30, compared with $165.5 million as of March 31.

In the absence of additional funding from its existing agreements with Oaktree Fund Administration and Qatar Investment Authority, the company said it expects the current cash to last through mid-2024, compared with its previous forecast of 2025.