B.C. biotech Zymeworks Inc. (NYSE:ZYME) is cutting its workforce by 25%, with its executive ranks facing a significant culling following the appointment of a new CEO.
“While we sincerely understand and appreciate the personal impact of these changes on employees in our organization, starting immediately, a smaller, more focused workforce is essential for us to improve our operating performance and accomplish our key priorities in a more cost-efficient manner,” CEO Kenneth Galbraith said in a statement.
After shares peaked at a historical high of US$56.81 in January 2021, they've since fallen to US$11.23 — below the US$13 they debuted at when the company went public in 2017.
Galbraith, a Zymeworks board member from 2009-13, officially took the reins from co-founder Ali Tehrani on January 15.
In addition to laying off 25% of its overall workforce, the company is cutting its senior management team by half.
That includes its chief people officer, chief commercial officer and chief scientific officer.
The layoffs come as talent in the biotech industry remains in high demand, with B.C. companies such as AbCellera Biologics Inc. (Nasdaq:ABCL), Stemcell Technologies Inc. and Aurinia Pharmaceuticals Inc. (Nasdaq:AUPH) seeking to grow significantly in the coming years.
Tehrani told BIV last spring the recent and rapid growth of B.C.’s life sciences sector has been stemming the tide on any brain drain the province once faced.
“Now we have companies, now we have critical mass that is enabled to hire [local talent], give them a chance to shine, give them a chance to grow,” he said.
“At the same time, because of our success, we've been able to bring talent … that historically has stayed in the United States or in Europe. Our friends south of the border, American citizens, European citizens now feel like that's where I want to go.”
In addition to reducing Zymeworks’ headcount, Galbraith said the company would now focus on its “most promising R&D opportunities.”
It’s also seeking additional financing after raising US$320 million in January 2020 as part of an underwritten public offering.
Its 2017 initial public offering raised nearly $60 million.