Genexine said it would halt developing GX-19N, a Covid-19 vaccine candidate. The termination of the two-year pipeline development is expected to bring considerable repercussions such as financial losses and unhappy reactions from the company’s shareholders, industry watchers said.
In a public disclosure on Friday, the Korean biotech firm said it would withdraw the application for a phase 2/3 trial of the investigational vaccine in Indonesia, approved last year. It also plans to cancel the application for a study of a booster shot submitted to the Argentine authorities.
Genexine said the announcement was about “revising a vaccine development strategy,” but the company has no plan for an additional clinical trial. The company is dropping the whole project on Covid-19 vaccine development two years after announcing the development plan.
Although Genexine completed a local phase 2a trial of DNA-based Covid-19 vaccine candidate GX-19N and applied for a phase 2/3 study in Indonesia, the company saw low profitability from the vaccine business due to the global vaccine supply situation and decided not to conduct a global trial, it said.
An official at Genexine admitted the company missed the timing for Covid-19 vaccine development.
“The Covid-19 pandemic is becoming endemic, like influenza, and the urgency of developing a vaccine has weakened because countries with high vaccination rates started lifting quarantine measures,” the official said. “We used to push for a strategy to obtain emergency use authorization around the world, but the strategy is no longer effective.”
Still, the company said that Genexine saw the potential of GX-19N as a vaccine against an endemic and would continue working on it as a vaccine against another pandemic.
The company also said it would focus on developing immunotherapy, including GX-I7 and GX-188E.
However, the company is expected to suffer a setback due to the discontinued Covid-19 vaccine development.
Genexine said it spent about 10 billion won to develop the Covid-19 vaccine as of December.
In May last year, Genexine signed a contract manufacturing organization (CMO) agreement with Hanmi Pharmaceutical for Covid-19 vaccine production.
Rumors are circulating that Sung Young-chul, chairman of Genexine, is likely to step down from executive director and chairman of the board of directors at a general shareholders’ meeting at the end of March. Following his resignation as Genexine CEO last year, he might resign from all management roles this year.
In response to the rumors, Genexine sent a letter to shareholders saying, “Chairman Sung Young-chul has provided important advice for R&D as chairman of the Genexine’s science advisory committee.” “He will continue his role.”