Only four months after IO Biotech decided to halve its head count, the Danish biotech is already considering whether it must resort to further layoffs.
In September, IO received a knock-back from the FDA to its hopes of submitting its therapeutic cancer vaccine Cylembio for approval. Until that point, the company had clung onto the hope of taking Cylembio to market, despite the vaccine having failed to beat Merck & Co.’s Keytruda in a phase 3 melanoma trial the previous month.
Unlike high-profile personalized cancer vaccines being developed by mRNA companies Moderna and BioNTech, Cylembio is a combination of two off-the-shelf vaccines derived from IO’s T-win platform. The aim is to stimulate T cells against tumor cells in the tumor microenvironment.
Even with the FDA’s feedback, the Copenhagen- and New York-based biotech said in September that it likely would persevere with securing a European approval while discussing with the FDA what a new registrational study could look like.
Even with this optimistic outlook, IO needed to lay off half its staff to conserve a cash reserve that had otherwise been expected to run out in the first quarter of 2026.
A meeting with the FDA to discuss this next phase 3 study was penciled in for December, but the company never announced the outcome.
Instead, IO’s leadership revealed this morning that the company “intends to explore a range of strategic alternatives to maximize stockholder value.”
Options on the table stretch across the typical scenarios envisaged by beleaguered biotechs—namely, a merger, asset sale, liquidation or dissolution. Alongside this, IO—which ended September with $31 million in the bank—specifically name-checked the possibility of further layoffs.
“The company is also evaluating a further reduction-in-force and other efforts to significantly reduce the company’s operating expenses while the company explores a range of strategic alternatives,” IO said in the Jan. 21 release.
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