WALTHAM, Mass., Aug. 16, 2016 (GLOBE NEWSWIRE) -- Chiasma, Inc. (NASDAQ:CHMA), a biopharmaceutical company focused on improving the lives of patients with rare and serious chronic diseases, today announced that it is further reducing its workforce by approximately 44%, primarily in the company’s research and general and administrative functions, to lower its operating expenses and extend its cash runway. This action follows Chiasma’s announcement of a corporate restructuring plan in June 2016, which included an initial workforce reduction composed primarily of the company’s commercial personnel. Chiasma intends to focus its resources on the continued development of Mycapssa®(octreotide) capsules for the maintenance treatment of adult patients with acromegaly.
“We extend our sincere appreciation to those who will be leaving Chiasma for their contributions toward bringing new treatment options to patients,” said Mark Leuchtenberger, president and chief executive officer of Chiasma. “While this decision is extremely difficult, we believe it is the prudent course of action as we seek to conserve our cash and continue our dialogue with the U.S. Food and Drug Administration (FDA) regarding development of Mycapssa.”
Chiasma estimates that it will incur aggregate charges related to the headcount reduction of approximately $0.8 million to $1.0 million for one-time severance and related costs in the third quarter of 2016. These charges are expected to result in cash expenditures that will be substantially complete by the end of the first quarter of 2017. As of June 30, 2016, Chiasma had $115.6 million of cash, cash equivalents and marketable securities.
This action is expected to be substantially complete in the current quarter, and when combined with Chiasma’s previous restructuring plan, will result in a reduction to the company’s workforce of more than 60% since May 1, 2016. The company expects to realize more than $7.0 million in annualized payroll and related expense savings as a result of these combined actions.
Chiasma is retaining a core team of fewer than 25 executive, clinical, regulatory and general and administrative personnel. The company continues to enroll patients in its MPOWERED™ Phase 3 trial comparing the safety and efficacy of Mycapssa to monthly somatostatin analog injections to support a potential Marketing Authorization Application (MAA) with the European Medicines Agency (EMA).
About Mycapssa
Mycapssa is the conditional trade name of octreotide capsules, an investigational new oral drug in development for the maintenance therapy of adult patients with acromegaly. Mycapssa has been granted orphan designation in the United States and the European Union for the potential treatment of acromegaly. Mycapssa has not been approved for use in any jurisdiction.
About Chiasma
Chiasma is dedicated to improving the lives of patients who face challenges associated with their existing treatments for rare and serious chronic diseases, using its Transient Permeability Enhancer (TPE®) technology platform. The company is conducting an international Phase 3 clinical trial of octreotide capsules (conditionally trade-named “Mycapssa®”) for the maintenance treatment of adult acromegaly patients to support a potential submission of a Marketing Authorization Application to the European Medicines Agency. Chiasma received a Complete Response Letter (CRL) from the U.S. Food and Drug Administration (FDA) on April 15, 2016 regarding its New Drug Application (NDA) for Mycapssa in the United States. Chiasma is headquartered in the United States with a wholly-owned subsidiary in Israel. Mycapssa, TPE and MPOWERED are trademarks of Chiasma.
