Just as Esperion’s cholesterol sister meds Nexletol and Nexlizet launched at the start of the pandemic, pharma marketing went virtual. As its cash dwindles, the company is reaching for the ax.
Esperion is cutting 40% of its workforce, or about 170 employees, to reduce costs by at least $80 million a year in 2021 and 2022, the Michigan-based drugmaker said Monday.
The company admitted it’s facing challenges with the launch of Nexletol and Nexlizet during the pandemic. Now, it'll further shift its marketing strategy toward digital outreach.
“In-person access to health care providers has been negatively impacted by the ongoing COVID-19 pandemic.,” Esperion’s newly minted CEO Sheldon Koenig said in a statement. The firm will focus on “an optimized blend of focused outreach including a streamlined salesforce, directed to targeted cardiologists and primary care physicians, and a suite of digital initiatives,” it said.
Esperion earned FDA green lights for Nexletol and Nexlizet to be used alongside statin for patients with high LDL cholesterol in February 2020, on the eve of COVID-19 becoming a global health crisis. Nexlizet is a combo of Nexletol and Organon’s—previously Merck’s—Zetia.
The oral drugs have been struggling to gain traction during the pandemic, generating just $17 million in the first half of the year. For the third quarter, Esperion expects revenues of $10.5 million to $11 million.
In the meantime, the slow ramp-up of Nexletol and Nexlizet is straining Esperion’s balance sheet. The company’s cash as of Sept. 30 was $153.7 million, down from $219.2 million in June and $305 million at the end of 2020.
The cash decline came despite some extra financing help recently. In April, Esperion secured $50 million from Oberland Capital under a revenue-based funding agreement. It also persuaded partner Daiichi Sankyo to pay up $30 million to expand their licensing agreement to cover additional ex-U.S. territories.
Koenig was brought on to right the ship. The former Sanofi cardiovascular franchise head jumped from Portola Pharmaceuticals to become Esperion’s chief operation officer in December and took over as CEO from longtime captain Tim Mayleben in mid-May.
Before Esperion, PCKS9 injectables from Amgen and a partnership between Sanofi and Regeneron were already duking it out in LDL-c, and Amarin offers Vascepa as an oral option. Those therapies have one thing in common: They all have approvals reflecting their ability to reduce heart-related events.
Esperion’s now also betting its future on all-important cardiovascular outcomes data. Savings from a leaner organization will enable its continued investment on a Nexletol outcomes trial, dubbed Clear, which Esperion expects to post top-line results in the first quarter of 2023. If successful, the trial could expand Nexletol’s addressable patient population from about 8 million to 19 million and could significantly reduce the drug’s current reimbursement hurdles, according to an Esperion presentation.
Meanwhile, Novartis is also trying to enter the LDL-c market with another PCSK9 drug, inclisiran, approved in Europe under the brand Leqvio. After a manufacturing inspection-related complete response letter, Novartis has refiled the high cholesterol therapy in July with a new production location.
Despite the financial hardship, Esperion in December shelled out $12.5 million upfront to license a preclinical oral PCSK9 candidate from Serometrix.