NEW YORK – Encoded Therapeutics on Thursday said it has laid off 29 percent of its employees in a move to fund operations through the third quarter of 2026.
The layoffs primarily affect technology and early-stage R&D functions, according to Encoded. The move will support the company as it advances its gene therapy programs in Dravet syndrome, dubbed ETX101, and Angelman syndrome, dubbed ETX201, as well as research to nominate development candidates for common central nervous system disorders.
"Given the significant potential of our portfolio, Encoded is focusing resources on ETX101 and our established programs where we have the greatest opportunity to create near-term value," Encoded Cofounder and CEO Kartik Ramamoorthi said in a statement. "In parallel, we have made the difficult decision to reduce the size of our technology and early-stage research and development functions."
The workforce reduction will provide Encoded with funds to continue to advance ETX101, a gene therapy that it's developing for SCN1A-positive Dravet syndrome. Encoded said it has aligned with the US Food and Drug Administration and the UK Medicines and Healthcare Products Regulatory Agency on the design of a sham-controlled confirmatory trial.
So far, eight patients between 6 months and 7 years of age have been treated with the gene therapy within Phase I/II trials in Australia, the US, and the UK. As of Wednesday, the gene therapy has been well tolerated with no treatment-related serious adverse events, according to Encoded. The company anticipates reporting preliminary safety and efficacy data in the second half of the year.
South San Francisco, California-based Encoded is also advancing ETX201, a gene therapy for Angelman syndrome, into investigational new drug-enabling (IND) studies after promising safety and target engagement data in nonhuman primate studies. The biotech firm expects to submit an IND application to the FDA for ETX201 next year.
Encoded has received an undisclosed upfront payment from a deal it entered into last year with Eli Lilly subsidiary Prevail Therapeutics, under which Lilly will use tools from Encoded to regulate transgene expression in its therapeutic candidates. Encoded is also eligible to receive payments tied to preclinical, development, regulatory, and commercial milestones through this agreement.