Orphazyme Calls For Court-Mediated Restructuring, Lays Off 50% Workforce

  • Orphazyme A/S's ORPH board of directors has called for a court-mediated restructuring, prompting the second round of layoffs in less than a year.
  • The in-court restructuring will determine whether any operations can continue if the Company can raise any capital or if it is prudent to sell all or some parts of its assets.
  • In June, Orphazyme axed two-thirds of its workforce.
  • Orphazyme recently closed its commercial business in the U.S., U.K., and Germany, and it also plans to delist from Nasdaq, likely effective by the end of March. 
  • In late March 2021, Orphazyme announced its lead asset, arimoclomol, failed to improve disease progression in a phase 2/3 trial for inclusion body myositis, a progressive muscular disorder. 
  • In May, the same asset failed to prove any benefit for amyotrophic lateral sclerosis patients in a phase 3 trial. 
  • After FDA rejection for arimoclomol, EMA's advisory committee adopted a negative trend vote on arimoclomol application.
  • Arimoclomol was initially licensed from CytRx Corp CYTR in 2011 for $150,000 in upfront cash plus $150 million in royalty payments. 
  • In a 2019 release, CytRx said it was slated to earn $10 million should arimoclomol be approved in the U.S. and Europe. 
  • Price Action: ORPH shares are down 39.40% at $0.76 during the market session on the last check Friday.
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