Elevation Oncology Halts Claudin 18.2 ADC EO-3021 Development and Announces 70% Workforce Reduction

　　【Pharmaceutical Network Industry DynamicsIn recent years, due to issues of resource allocation and capital concentration, pharmaceutical companies have frequently cut costs, especially in new drug development pipelines. Recently, multinational pharmaceutical companies such as Johnson & Johnson, Pfizer, and Biogen have successively terminated the development of multiple high-cost new drugs.
 

On March 20, Elevation Oncology announced the termination of the development of its core pipeline EO-3021, due to the drug's U.S. Phase I clinical data not meeting expectations. EO-3021 is a Claudin 18.2 ADC originally developed by CSPC Pharma Group. In July 2022, Elevation acquired the global rights (excluding Greater China) for this drug through an agreement worth nearly $1.2 billion (a $27 million upfront payment + $1.168 billion in milestones + a certain percentage of sales royalties).
 

The announcement revealed that after terminating the development of EO-3021, Elevation will next focus on developing the HER3 ADC new drug EO-1022, which debuted in December of last year. Elevation acquired the license for this technology through a deal worth $368 million. Due to the discontinuation of this clinical-stage drug, Elevation is implementing layoffs affecting approximately 70% of its workforce. The total cash payments and costs associated with these layoffs are estimated at around $3 million, with the majority expected to be paid by the end of June 2025.
 

In March, Johnson & Johnson also terminated two new drug development projects in succession. On March 7, Johnson & Johnson halted the Phase 3 project of its investigational drug aticaprant for the treatment of Major Depressive Disorder (MDD) due to "insufficient efficacy." On March 10, it was reported that Johnson & Johnson announced it was giving up the option for global licensing, development, manufacturing, and commercialization of the next-generation CD38 monoclonal antibody HexaBody-CD38 (GEN3014).
 

Overall, the reasons for the suspension of most pipelines of multinational pharmaceutical companies include clinical trial results that did not meet expectations, lack of market competitiveness, focus on advantageous projects, and decreased drug demand due to changes in the external environment. These issues actually affect not only multinational pharmaceutical companies but also many domestic pharmaceutical companies, which have successively terminated their research projects this year for similar reasons.
 

On the evening of January 1, 2025, SPH announced its decision to terminate the clinical trials and subsequent development of three R&D projects: I001-B (US), I022 (US), and C012 (US). It is reported that I001-B (US) and I022 (US) are in Phase II of clinical trials in the US, while C012 (US) has received Phase I clinical trial approval from the FDA.
 

Notably, in recent years, SPH has been frequently cutting its pipeline. In 2024 alone, it disclosed three announcements of R&D project terminations, with a total of 12 R&D projects being terminated, resulting in nearly 700 million yuan wasted. Among the 12 terminated projects, seven were monoclonal antibody projects.
 

Overall, the high risk, large investment, and long return cycle of new drug development have made it a common practice for pharmaceutical companies to cut pipelines. In the future, under the guidance of policies and intensified market competition, the R&D capabilities of pharmaceutical companies are expected to become more focused, and they will also be more cautious in pipeline development.
 

　　Disclaimer: In no event shall the information or opinions expressed in this article constitute investment advice to any person.