Following a phase 3 knee osteoarthritis failure that its CEO acknowledged caused “great disappointment and concern,” Kolon TissueGene is laying off 37 employees at its Maryland headquarters.
The layoffs will take effect at the end of August, according to a filing with the Maryland labor department.
The layoffs are “part of a broader realignment of our business and operational priorities,” a TissueGene spokesperson told Fierce. “We remain focused on Kolon TissueGene’s mission to improve the well-being and quality of life for individuals with degenerative musculoskeletal disease.”
TissueGene’s cell therapy TG-C contains a mix of donor-derived cartilage cells called chondrocytes and embryonic cells from a cell line that have been engineered to pump out TGF-β1, an important regulator of cell activity.
South Korea originally approved the therapy in 2017, only to retract the approval two years later over a mix-up regarding the kind of cells used in the treatment. TissueGene then endeavored to prove TG-C’s efficacy with a 531-patient trial in the U.S., which the company revealed in July to have missed its co-primary endpoints.
The failed phase 3 study had run into problems previously too, with enrollment delayed for close to four years due to an FDA hold.
In a video shared on TissueGene’s website, CEO Seng Ho Jeon, Ph.D., apologized directly to shareholders and promised the company would figure out why the trial didn’t succeed.
“We will examine all available data from the ground up,” he said. “We will review the data carefully, objectively, and without reaching any conclusions in advance.”
“Once again, I sincerely apologize for the disappointment and concern we have caused,” he concluded.
Topline results from a second phase 3 trial of TG-C are expected in October. The ongoing trial has the same arms and coprimary endpoints as the failed trial, along with nearly identical inclusion/exclusion criteria. TissueGene has said it will determine the fate of the TG-C program after seeing data from the second phase 3 study.
Editor's note: This story was updated at 5 p.m. ET with a statement from Kolon TissueGene.