Neoleukin Therapeutics Provides Strategic Update and Announces Restructuring and Leadership Transition

Rhea-AI Summary

Neoleukin Therapeutics (NASDAQ: NLTX) has engaged SVB Securities to explore strategic alternatives aimed at maximizing shareholder value, which may encompass potential sales, mergers, or divestitures. Additionally, the company announced a workforce reduction of approximately 70% as part of a corporate restructuring to conserve cash amidst challenging capital market conditions. CEO Jonathan Drachman will also step down following a brief transition. Neoleukin's Board highlighted the importance of their immunotherapeutic advancements but deemed the current environment necessitated a reassessment of strategies to bolster shareholder value.

Positive

• Engagement of SVB Securities indicates a proactive approach to enhancing shareholder value.
• Exploration of strategic alternatives may lead to beneficial transactions.

Negative

• 70% workforce reduction raises concerns about company continuity and expertise.
• CEO transition could lead to management instability during a critical period.

SEATTLE, March 08, 2023 (GLOBE NEWSWIRE) -- Neoleukin Therapeutics, Inc., “Neoleukin” (NASDAQ:NLTX), a biopharmaceutical company utilizing sophisticated computational methods to design de novo protein therapeutics, today announced that it has engaged SVB Securities to assist in reviewing strategic alternatives for the Company with the goal of maximizing shareholder value. Such alternatives may include a sale, merger, divestiture of assets, licensing or other strategic transaction. There can be no assurance that the exploration of strategic alternatives will result in any agreements or transactions, or that, if completed, any agreements or transactions will be successful or on attractive terms. Neoleukin does not expect to disclose or provide an update concerning developments related to this process until the Company enters into definitive agreements or arrangements with respect to a transaction or otherwise determines that other disclosure is necessary or appropriate.

In connection with the evaluation of strategic alternatives, the Board of Directors of Neoleukin also approved a further corporate restructuring to preserve cash, including a reduction in the Company’s workforce by approximately 70%. Chief Executive Officer Jonathan Drachman, M.D., will also be stepping down after a short transition. The Company expects this reduction in force to be completed during the first half of 2023.

“The work that Neoleukin has done to advance the science of de novo protein design for immunotherapeutic use, including what we believe is the first in-human clinical trial of a de novo protein, is important and impressive. However, based on the anticipated time and investment necessary to further develop the technology and potential product candidates in this challenging capital markets environment, we believe that it is appropriate to pursue other strategic options,” said Todd Simpson, Chairman of the Board of Neoleukin. “It was a difficult decision to restructure our workforce as we conduct this review of strategic alternatives; however, we believe it was a prudent decision that will maximize shareholder value. We would like to thank Jonathan, the research team, and all employees who have worked on these ground-breaking advancements.”

About Neoleukin Therapeutics, Inc.

Neoleukin is a biopharmaceutical company creating next generation immunotherapies for cancer, inflammation and autoimmunity using de novo protein design technology. Neoleukin uses sophisticated computational methods to design proteins that demonstrate specific pharmaceutical properties that provide potentially superior therapeutic benefit over native proteins.  For more information, please visit the Neoleukin website: www.neoleukin.com.

Contact:
Media
Julie Rathbun
206-769-9219
jrathbun@neoleukin.com

FAQ

What strategic alternatives is Neoleukin exploring?

Neoleukin is reviewing options including potential sales, mergers, or asset divestitures to maximize shareholder value.

What workforce changes has Neoleukin announced?

Neoleukin will reduce its workforce by approximately 70% to preserve cash amid challenging market conditions.

Why is Neoleukin's CEO stepping down?

CEO Jonathan Drachman is stepping down as part of a corporate restructuring while the company evaluates strategic alternatives.

How might the workforce reduction impact Neoleukin?

The significant reduction in workforce could affect operational capacity and continuity, raising concerns among investors.