New Haven-based biopharmaceutical company BioXcel Therapeutics Inc. announced Thursday that it has cut 28% of its workforce and eliminated a C-suite position as it continues to struggle financially.
According to a document filed with the U.S. Securities and Exchange Commission, BioXcel’s board of directors on Sept. 17 approved a plan to reduce its workforce by 15 employees, “or approximately 28% of the company’s headcount.”
Based on those numbers, the company employed about 54 people before the job cuts.
The next day, the document states, the company notified Matt Wiley, its chief commercial officer, that his position was being eliminated. The company said Wiley agreed that his employment would end on Oct. 2, but that he would continue to serve as a consultant for an unstated period of time after that.
The document refers to the job cuts as a “clinical prioritization,” and states it was necessary “in order to extend its cash runway and prioritize investment on the clinical development of its lead neuroscience asset, BXCL501.”
The company said the job cuts will cost approximately $1.4 million, primarily related “to severance payments, notice pay and related continuation of benefits costs.” It said it expects those payments to be made in cash.
BioXcel said it expects the majority of the costs will be incurred, and the layoffs to be completed, during the quarter that ends Dec. 31.
In a news release, BioXcel CEO Vimal Mehta, said the company is “prioritizing our late-stage clinical programs for BXCL501 in bipolar disorders, schizophrenia, and Alzheimer’s disease and placing greater emphasis on advancing these trials.”
He added that BioXcel believes “these programs represent attractive growth opportunities, and we look forward to focusing on these top-priority clinical development initiatives.”
Based at 555 Long Wharf Dr., BioXcel uses artificial intelligence to develop medicines in neuroscience and immuno-oncology. The company is evaluating BXCL501 as a treatment for agitation associated with Alzheimer’s dementia (AAD).
The company also developed and commercially sells its drug under the trademarked name IGALMI (dexmedetomidine). IGLAMI is a thin-film that dissolves in the mouth to treat acute agitation in patients with schizophrenia and bipolar disorder. It was approved by the Food and Drug Administration in April 2022.
The company said Thursday that it plans to continue to supply IGALMI to current and future customers “through existing distribution channels, without commercial support.”
In August, the company reported a net loss of $8.3 million, compared to a net loss of $53.5 million for the same quarter last year. It also said it had used $23.2 million in operating cash during the second quarter, and that cash and equivalents totaled $56.3 million as of June 30.
In that earnings report, BioXcel said net revenue for IGALMI was $1.1 million in the second quarter, up 90% from the first quarter of 2024 and up 141% from the same quarter last year.
The layoffs announced this week are the largest since BioXcel first began reducing its workforce in August 2023, when it announced plans to cut more than half of its staff, which at the time numbered 190.
The latest announced job cuts means the company has slashed its staff by nearly 80% in just over a year.
In March, the company announced a $25 million registered direct offering. That announcement came about six weeks after it had called off a $60 million public offering, stating at the time “that current market conditions are not conducive for an offering on terms that would be in the best interests of the company’s shareholders.”
On March 25, however, BioXcel said it had entered into the securities purchase agreement with investors in a registered direct offering for aggregate gross proceeds to the company of approximately $25 million.
BioXcel trades on the Nasdaq stock exchange under the symbol BTAI. Monday morning, shares were trading at 65 cents per share, far below its 52-week high of $5.62.