It’s been an eventful year so far for Molecular Templates—and not in a good way. The Bristol Myers Squibb-partnered biotech halved its head count in March to reduce costs, before its CD38-directed cancer candidate was hit by a two-month-long FDA hold that only lifted at the start of June.
Now, the company has announced another wave of layoffs, with 44% of the remaining staff set to go as part of a new restructuring plan. The biotech announced the move alongside an agreement with K2 HealthVentures to “satisfy and discharge” the biotech’s debt with the investment firm.
It means that Molecular Templates paid off $27.5 million of its debt to K2, leaving an outstanding balance of around $10 million that will be paid off in the event of certain business developments, such as selling off one of the biotech’s asset or another transaction.
The drug developer still has the option to pay off the balance in full, while K2 can choose to convert $3 million of the outstanding balance into shares of Molecular Templates’ stock.
The biotech had previously announced that it had charged Stifel, Nicolaus & Company to help seek out strategic alternatives to sustain the business, including financing or recapitalization, a sale or merger. The review is still ongoing, and the latest round of layoffs have been conducted to “extend its resources to better position the organization,” the company explained in a postmarket release Friday.
The company had 222 employees before it halved its head count in March, meaning the latest restructuring could potentially impact close to 50 roles.