Codexis' Strategic Focus: Discontinues Biotherapeutics Development, Lays Off 25% Of Employees, Cash Runway Into Mid-2026

Codexis Inc CDXS intends to prioritize advancing and commercializing its Enzyme-Catalyzed Oligonucleotide (ECO) Synthesis platform and its Pharmaceutical Manufacturing business. 

The company is discontinuing investment in certain development programs, primarily in Biotherapeutics, consolidating operations to its headquarters and reducing headcount by approximately 25%. 

Codexis had $92.1 million in cash and cash equivalents as of June 30, 2023, and with these changes, it expects that this balance will be sufficient to fund its planned operations to mid-2026.

Also Read: Codexis Shelves Development Of Certain Internal Programs, Cuts Workforce.

Codexis will prioritize its resources to complete the development and commercialization of its proprietary ECO Synthesis platform. It offers a suite of enzymes and a process designed to enable scalable RNA interference (RNAi) therapeutics production. 

Codexis anticipates demonstrating the gram-scale synthesis of the platform by the end of 2023, providing a key point of technical validation to enable select pre-commercial customer testing of the platform to begin in 2024.

The company will discontinue all pre-clinical discovery work in Biotherapeutics, including inborn errors of metabolism and gene therapy. 

Codexis plans to discontinue its 50/50 development support of CDX-7108 for exocrine pancreatic insufficiency and is actively negotiating with its partner, Nestlé Health Science S.A., to advance the program. 

Codexis expects Q2 FY23 sales of $21 million-$22 million compared to the consensus of $18.09 million.

Codexis is reiterating its 2023 product revenue and gross margin guidance of $30 million-$35 million and 55%-65%, respectively. Both metrics exclude enzyme sales related to Pfizer's covid-19 oral pill Paxlovid.

Price Action: CDXS shares are up 7.78% at $3.74 on the last check Friday.