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Reneo Pharma Trial Fails; Stock Plummets 81%

Says will lay off 70% of workforce

Irvine-based Reneo Pharmaceuticals Inc. (Nasdaq: RPHM) dropped 81% to $1.44 and a $48 million market cap after announcing the failure of its pivotal clinical trial.

The company said it will immediately start cost savings initiatives, including suspension of its ongoing mavodelpar development activities and a workforce reduction of approximately 70% of its workforce of 55 employees.

The company said its Stride study of mavodelpar in adult patients with primary mitochondrial myopathies did not meet its primary efficacy or secondary efficacy endpoints.

“Although the results of the Stride study were negative, the data generated are vitally important to the scientific community and we will make these data available once the final analyses are complete,” CEO Gregory J. Flesher said in a statement.

Reneo is testing a drug to treat rare genetic diseases, including primary mitochondrial myopathies (PMM). In more simple terms, the disease prevents people from metabolizing food in their bodies, meaning their muscles and other organs don’t fully develop.

The company said it currently has over $100 million in cash, cash equivalents, and short-term investments.

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Peter J. Brennan
Peter J. Brennan
Peter J. Brennan has been a journalist for 40 years. He spent a decade in Latin America covering wars, narcotic traffickers, earthquakes, and business. His resume includes 15 years at Bloomberg News where his headlines and articles sometimes moved the market caps of companies he covered by hundreds of millions of dollars. His articles have been published worldwide, including the New York Times and the Washington Post; he's appeared on CNN, CBC, BBC, and Bloomberg TV. He was awarded a Kiplinger Fellowship at The Ohio State University.
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