MacroGenics Jumps Biotech Layoff Bandwagon, Cuts 15% Of Workforce

MacroGenics Jumps Biotech Layoff Bandwagon, Cuts 15% Of Workforce
  • MacroGenics Inc MGNX announced a corporate restructuring involving a 15% workforce reduction, closure of an R&D facility, and closure of a manufacturing site. 
  • After discontinuing a Phase 2 study for enoblituzumab, a program that was upside to estimates, the company's pipeline efforts are more narrowly focused on MGC018, lorigerlimab, and MGD024. 
  • The Phase 2/3 study for MGC018 in metastatic castration-resistant prostate cancer (mCRPC) remains expected to initiate by YE22, and enrollment is ongoing into a Phase 1/2 study of MGC018 + lorigerlimab. 
  • The corporate restructuring plan is expected to extend the company's cash runway into 2024.
  • SVB Leerink writes that the next key catalyst for the stock is an update on the lorigerlimab program expected by early 2023. 
  • "We expect investor focus on the pipeline remains squarely on MGC018, though the timing of the next data disclosure remains unclear. Overall, we continue to view MGNX and lead program MGC018 favorably," the analyst writes.
  • SVB has reiterated its Outperform rating with a price target lowered to $12 from $15, reflecting prioritization of MGC018 in mCRPC and removal of other indications from estimates.
  • Price Action: MGNX shares are up 13% at $5.14 during the market session on the last check Tuesday.

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