Shares in Idorsia, a Swiss biotech company, plunged after the company announced the suspension of its goal to achieve profitability by 2025. The setback is attributed to the slower-than-expected increase in sales of its insomnia treatment, Quviviq. Idorsia is actively working towards securing additional funding to overcome this challenge.
As of June 30, the company’s liquidity stood at CHF33 million, a significant decrease from CHF212 million as of March 31 and CHF466 million at the end of last year. Despite this financial decline, Idorsia reported a narrowed net loss of CHF193 million for the second quarter, compared to CHF222 million in the same period the previous year. Revenue also saw an upswing, rising from CHF5 million to CHF30 million. However, an operating loss of CHF177 million was still incurred, albeit lower than the CHF212 million loss from the previous year.
Looking ahead, Idorsia anticipates an operating loss of CHF735 million for 2023. This projection takes into account the recent agreement to sell its affiliates in South Korea and Japan to Sosei Heptares, a biopharmaceutical company based in London, for CHF400 million. However, this gain from the sale will not be factored into Idorsia’s full-year financial results.
The combination of the sale, a portfolio review, a restructuring program, and slower-than-anticipated Quviviq sales have necessitated a deferral of Idorsia’s 2025 profitability target. The company is actively exploring various initiatives to secure additional funding in the latter half of 2023. Simultaneously, they have launched a cost reduction initiative expected to fully take effect by early 2024.
Chief Financial Officer Andre C. Muller stated, “We are working on several initiatives to secure additional funding in the second half of 2023 and, in parallel, we launched a cost reduction initiative that is expected to have full effect by early 2024.”