Penny Stock Sutro Biopharma Cuts Costs, Refocuses Pipeline
On Thursday, Sutro Biopharma, Inc. (NASDAQ:STRO) prioritized its antibody-drug conjugates (ADC) pipeline, including three wholly-owned preclinical programs in its next-generation ADC pipeline.
- Exatecan ADC targeting Tissue Factor, STRO-004, will enter the clinic in the second half of 2025.
- STRO-006: Sutro’s differentiated integrin beta-6 ADC will enter clinical development in 2026, aimed at multiple solid tumors.
- An IND for Sutro’s first wholly-owned dual-payload ADC is anticipated to be filed in 2027.
Sutro expects operations at its manufacturing facility in San Carlos to cease by the end of 2025.
Additionally, the company has deprioritized additional investment in developing Luveltamab tazevibulin (luvelta, STRO-002) across all indications and is reducing headcount by nearly 50%. The company will continue to explore global out-licensing opportunities for luvelta.
As of Dec. 31, 2024, Sutro had $316.9 million in cash, cash equivalents, and marketable securities.
The company estimates cash payments resulting from the strategic portfolio review and related restructuring to be $40 to $45 million.
Cost reductions subsequently realized from the restructuring, combined with refocused clinical development priorities, give the company an expected cash runway into at least the fourth quarter of 2026, excluding anticipated milestones from existing collaborations.
The cancer-focused biotech reported a 2024 loss of $2.96 per share, up from a loss of $1.78 a year ago, missing the consensus of $2.92.
The company reported sales of $62.04 million, beating the consensus of $59. million, compared to $153.7 million a year ago, with the 2024 amount related principally to the Astellas collaboration and the Tasly agreement.
Additionally, Jane Chung, President and Chief Operating Officer, will immediately assume the responsibilities of Chief Executive Officer and Board member.
Price Action: STRO stock is down 24% at $0.95 at the last check Friday.
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