Nkarta is laying off a third of its employees, including half of the biotech’s executive leadership, as the company diverts cash to its lead CAR NK candidate.
The South San Francisco-based company continued its pivot from oncology to autoimmune disease last year by halting work on the allogeneic CD19-directed CAR NK, dubbed NKX019, in lymphoma to focus on lupus. The final months of 2024 saw Nkarta launch two trials of NKX019: in lupus nephritis as well as in in systemic sclerosis, idiopathic inflammatory myopathy and ANCA-associated vasculitis.
Alongside those, an investigator-sponsored trial in systemic lupus erythematosus also kicked off, while another in myasthenia gravis has been cleared to start. The trials are due to begin reading out in the second half of this year.
Nkarta entered 2025 with $380.5 million in cash at hand, but, with clinical costs piling up, the company has announced a restructuring plan to extend this money by over a year—into 2029.
In practice, this means a “significant reduction” in head count, with 53 positions—equivalent to 34% of the workforce—set to leave and “every level of the organization” impacted, CEO Paul Hastings explained in a full-year earnings release.
Not even the top of the organization will be spared, with Nkarta “reducing the executive leadership team by over 50%,” the CEO said. Chief Financial and Business Officer Alyssa Levin will be among the departures, according to a Securities and Exchange Commission filing.
Nkarta is set to pay out between $5.5 million and $6.5 million in relation to the layoffs.
“We believe that this decision is necessary in today’s challenging financial and competitive environment to fulfil Nkarta’s vision of bringing potentially life-saving cellular therapies to people with autoimmune disease,” Hastings added.
William Blair analysts described the layoffs as “unfortunate” but “necessary.”
“We look forward to initial clinical data from the Ntrust-1 and Ntrust-2 trials in the second half of 2025, which we believe will be major catalysts for the company by providing early proof-of-concept on the CAR-NK cell approach in autoimmune diseases,” the analysts said in a March 27 note.
Nkarta’s course toward lupus was set in 2023 and then reaffirmed a year ago when the company deprioritized a CAR NK candidate after data from 14 patients with acute myeloid leukemia failed to live up to the asset’s initial promise. The pivot to autoimmune diseases followed an increasingly well-worn path for cell therapy biotechs, with data suggesting CD19-focused treatments in particular may be effective against lupus.
https://www.fiercebiotech.com/biotech/nkarta-lays-3rd-staff-including-cfo-fund-autoimmune-trials
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