Allakos Inc. (ALLK) announced on Monday that the topline results from its phase 1 clinical trial for AK006, undertaken in adult patients suffering from moderate-to-severe chronic spontaneous urticarial, did not meet expectations.
The study involved 34 participants who were randomized to receive either 720 mg of AK006 via an intravenous route or a placebo every four weeks.
Unfortunately, AK006 did not demonstrate the desired therapeutic activity, prompting the biotechnology company to cease all related activities including clinical, manufacturing, research, and administrative functions associated with this drug.
As part of the restructuring, Allakos will reduce its workforce by 75%, retaining only around 15 employees. This core team will focus on exploring strategic alternatives, fulfilling regulatory and financial obligations, and concluding the phase 1 trial.
Based in California, Allakos anticipates that winding down AK006 development will incur costs between $34 million and $38 million, with most payments expected to occur during the first and second quarters of 2025.
The company projects holding cash, cash equivalents, and investments totaling approximately $35 million to $40 million by June 30, 2025.
Ahead of the market opening, Allakos's stock has fallen to $0.31, a decrease of 74.80% on the Nasdaq exchange.
