Gene therapy startup Locanabio lays off staff, narrows focus on Duchenne

Biotech startup Locanabio has laid off 30% of its workforce, portending a limited scope going forward for the gene therapy developer, backed with more than $150 million since its 2019 unveiling.

Kat Lange

Out of UC San Diego scientist Gene Yeo and bankrolled by a who’s who of biotech investors, Locanabio’s initial ambitions included various neurodegenerative, neuromuscular and retinal diseases. The focus now is on Duchenne muscular dystrophy, specifically targeting exon 51, CFO Kat Lange told Endpoints News in an email.

Lange also confirmed to Endpoints the biotech has narrowed the pipeline and reduced headcount to 50 employees, with about two dozen let go, after reviewing finances and taking a magnifying glass to its portfolio to “streamline budget in the face of the current tight funding environment.”

A blistering winter for biotech — stretching about four quarters at this point — has been cited by many drug developers and life sciences companies as reasoning for dwindling their workforces and pipelines. Public companies usually disclose the culls, but privately held biotechs do so less often.

The startup’s last announced financing was a $100 million Series B in December 2020, at which time an IPO looked to be on the horizon as preclinical biotechs rushed toward Nasdaq in a pandemic boom. Investors include some of the blue chip names in drug development venture capital: ARCH, RA Capital, GV (the Alphabet VC arm), Temasek, Lightstone Ventures, Vida Ventures, Acuta Capital Partners, Invus, UCB Ventures and SVB Leerink.

“Locanabio is using its CorrectX technology in an exon skipping approach which has generated positive preclinical data supporting further development of the program,” Lange wrote in the email. “These decisions are very difficult as it is always hard to lose talented employees.”

The biotech expects to start IND-enabling studies this year for its Duchenne program, Lange said, noting “exciting progress” has been made across neurodegeneration and neuromuscular diseases, but no mention of retinal. Other Duchenne gene therapy developers include Roche-partnered Sarepta Therapeutics, Pfizer, Solid Biosciences and Genethon.

The CFO declined to comment on “programs not in our published pipeline” in response to a question about an ex-employee’s mention of Alzheimer’s and Pompe disease work. The company’s pipeline, listed on its website, includes ALS, myotonic dystrophy type 1, Huntington’s disease and spinocerebellar ataxia 1. Previous versions also included an undisclosed retinal disease and frontotemporal dementia, according to web archives.

More financing will come once Locanabio’s gene therapy approaches in-human studies.

Jim Burns

“We will be considering another financing as our program moves closer to the clinic,” Lange said.

Leading the biotech is CEO Jim Burns, who joined in 2019 after leading Bayer and CRISPR Therapeutics’ partnership on Casebia. He took the helm from Jeffrey Ostrove, a repeat biotech executive who’s currently leading Papillon Therapeutics, formerly known as GenStem Therapeutics, a licensing partner on Avrobio’s AVR-RD-04 in a Phase I/II for cystinosis.

Locanabio was also founded by ex-chief technology officer David Nelles, a former UCSD post-doc. He now leads and co-founded an RNA-targeting biotech hoping to fix mutated genes. The startup, Tacit Therapeutics, is based at JLABs and has yet to break from stealth.

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