Gritstone Bio, a vaccines-focused biotechnology company, has filed a voluntary Chapter 11 petition to allow time for a strategic alternatives process to conclude, potentially salvaging its clinical programs. The company announced the bankruptcy filing on Thursday morning, signaling an effort to navigate financial challenges and preserve its assets.
Strategic Restructuring and Potential Acquisition
Gritstone is currently engaged in discussions with an unnamed party for a stalking horse transaction, a process where a buyer is lined up to purchase a bankrupt company's assets before a court auction. This approach aims to ensure that Gritstone's assets, including its vaccine programs, continue to be developed. The company intends to operate as usual during the restructuring process.
Pipeline and Clinical Programs
Gritstone's pipeline includes vaccine programs targeting both cancer and infectious diseases. Notably, the Granite program, a Phase II personalized vaccine for colorectal cancer, has shown promising early results. Additionally, Gritstone has a partnership with Gilead Sciences to develop a therapeutic vaccine for HIV.
Promising Phase II Data for Colorectal Cancer Vaccine
At the end of September, Gritstone announced encouraging interim Phase II data from the Granite program. The data indicated a 21% relative risk reduction of progression or death in patients receiving the study medication compared to the standard of care. A subset of patients with lower disease burden at the start of the study experienced a more significant 38% risk reduction. However, the company noted that the data require further maturation and follow-up to assess the durability of the observed survival benefit.
Financial Challenges and Runway
As of June 30, Gritstone reported $61.7 million in cash and equivalents. However, the company stated that these funds were insufficient to sustain operations for the next 12 months, according to their second-quarter earnings filing in August. Without additional financing, Gritstone anticipated its cash runway would expire in the fourth quarter.
