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After FDA Regulatory Setback, Penny Stock ObsEva Cuts 70% Of Its Staff

Benzinga · 09/13/2022 09:20
  • After running into a major roadblock at the FDA for its uterine fibroid drug, ObsEva SA (NASDAQ:OBSV) has flagged plans for significant layoffs as part of a wholesale restructuring under the supervision of the supervision court-appointed administrator.
  • In an update, ObsEva plans to lay off approximately 70% of employees, including Katja Buhrer, Chief Strategy Officer.
  • The company intends to complete the terminations in Q4 and shave $7.6 million off its annual expenses. 
  • In August, the company said it is facing a delisting threat from Nasdaq.
  • Related: This Women's Health Stock Gets Analyst Downgrade On 'Approvability Issues, Restructuring.'
  • ObsEva had an oral GnRH receptor antagonist, linzagolix. Although it managed to secure approvals from the EU and the U.K., the FDA found deficiencies in its marketing application, hinting at a delay.
  • The remaining team will manage the two partnered programs ObsEva decided to keep.
  • Ebopiprant, licensed by Merck & Co Inc's (NYSE:MRK) spinout Organon & Co (NYSE:OGN).
  • Nolasiban is a drug it believes could be used to improve in vitro fertilization. It has a regional pact with China's Yuyuan Bioscience Technology around this program, but CEO Brian O'Callaghan noted the company is "assessing the potential for further nolasiban development."
  • Price Action: OBSV shares are down 3.36% at $0.19 during the premarket session on the last check Tuesday.