Eliem CEO exits as neuro upstart chops headcount, pivots to preclinical program

For the second time in a year, Eliem Therapeutics is pivoting to a different neuro drug — but this time it’s being accompanied by drastic personnel changes.

Bob Azelby

CEO Bob Azelby is leaving the biotech alongside COO and CFO Erin Lavelle and general counsel Jim Bucher. They are among 55% of the staffers who are being let go as part of a reorganization around the lead program.

Eliem had 19 full-time employees and 12 part-time employees as of the end of 2021, according to its most recent disclosure. Shares $ELYM fell about 10% to $3 in pre-market trading.

Andrew Levin — the RA Capital partner and managing director who co-founded Eliem and serves as board chairman — will now be responsible for overseeing day-to-day operations in his new role as executive chair.

The new-look Eliem will no longer pursue ETX-155, the GABAA receptor positive allosteric modulator neuroactive steroid that was being set up for a Phase II study in major depressive disorder for this quarter.

“However, the Board determined that, given current capital market conditions and investor sentiment around the GABAA PAM opportunity in MDD, it is not in the best interests of the Company or its stockholders to invest in the Phase 2a MDD trial at this time,” the company wrote in a release.

ETX-155 was brought to the fore after Eliem’s initial lead compound, a pain drug, flunked successive mid-stage trials. While the company ran into drug exposure issues in Phase I, execs said in October that they had resolved the manufacturing problems that were to blame and were ready to proceed.

Andrew Levin

Working with Valerie Morisset, CSO and EVP R&D, Levin will instead focus on driving forward a preclinical program dubbed ETX-123, which targets the potassium channel subunits Kv7.2/3. Eliem’s current reserves of cash, cash equivalents and marketable securities add up to $123.6 million and, following the reorg, offers a runway unto 2027. Levin said it’s enough to see the program through compelling data catalysts.

He adds that the Kv7 program, which also consists of other preclinical candidates, leverages a “proven mechanism of action” and has broad potential for a variety of central nervous system disorders.

Morisset manages an R&D team in Cambridge, UK, while Azelby, the former chief commercial officer at Juno and ex-CEO of Alder, was recruited to run the headquarters in Seattle and clinical trial team in the US.

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