aibioAtara Biotherapeutics cuts workforce by about 30%, expects $1.4 million in severance
Tickers ATRA
The company will keep about 23 employees after the cut and expects about $1.4 million in severance. Its latest annual report said cash of $42.5 million would not last twelve months and that about $15 million more was needed to pursue US approval of its lead drug.
Key facts
- Company
- Atara Biotherapeutics, Inc. (NASDAQ: ATRA)
- News type
- Distress
- Primary source
- Atara Biotherapeutics, Inc. Form 8-K filed May 12, 2025 (SEC EDGAR)
Atara Biotherapeutics, Inc. (Nasdaq: ATRA) said it will cut its workforce by about 30% and keep about 23 employees. The company announced the reduction on May 12, 2025 in a Form 8-K filed under Item 2.05, the item for costs tied to exit or disposal activities.
What the filing says
Atara said the reduction will affect approximately 30% of its current employees and that it will retain approximately 23 employees essential to executing on its strategic priorities. It expects to complete the reduction by August 2025.
The company expects to recognize approximately $1.4 million for severance and related benefits for the laid-off employees. The charges are primarily one-time termination benefits and primarily cash charges. It added that it may incur other charges or cash expenditures not currently contemplated, and that more detail will appear in its Quarterly Report on Form 10-Q for the period ending June 30, 2025. President and Chief Executive Officer AnhCo Thieu Nguyen signed the filing. The 8-K does not say how many people were employed before the cut, which functions are affected, or what savings the company expects.
A going-concern warning already on record
Atara's annual report for 2024, filed March 7, 2025, reported a net loss of $85.4 million for the year. As of December 31, 2024 it held total cash, cash equivalents and short-term investments of $42.5 million, which it said would not be sufficient to fund planned operations for at least the next twelve months. Those conditions, it said, raise substantial doubt about its ability to continue as a going concern.
The company wrote that it does not believe its existing cash is enough to fund operations in the near term, and that approximately $15 million in additional financing is necessary to fund the activities required to achieve a biologics license application approval for tab-cel. That estimate assumed the receipt of future payments that depend on a successful transition of substantially all tab-cel activities to its partner by the end of the first quarter of 2025. It has no committed external source of funds other than milestone and royalty payments under its partnership agreement, subject to a royalty financing agreement. To fill the gap it said it plans to use public or private security offerings, its at-the-market facility or strategic transactions, with no assurance it will succeed.
The product at the center
Atara describes itself as an allogeneic T-cell immunotherapy company built on Epstein-Barr virus (EBV) T cells. Its lead program, tab-cel (tabelecleucel), is in Phase 3 development in the United States for EBV-associated post-transplant lymphoproliferative disease (EBV+ PTLD) in patients who have failed rituximab or rituximab plus chemotherapy. It has received marketing authorization under the name Ebvallo for sale in the European Economic Area, the United Kingdom and Switzerland. Its US biologics license application was accepted by the FDA in July 2024, which triggered a $20.0 million milestone payment from its partner Pierre Fabre Medicament, and the approval decision remains ahead. The company also lists two allogeneic CAR T programs, ATA3219 and ATA3431, and a potential EBV vaccine.
Partners and payment limits
Under an amended and restated agreement of October 31, 2023, Pierre Fabre holds exclusive rights to develop, manufacture and commercialize tab-cel worldwide. Atara could receive up to $580.0 million in further milestones in the additional territory, including up to $60.0 million tied to FDA approval, plus tiered royalties. Pierre Fabre is to take over manufacturing, and Atara is to continue the Phase 3 ALLELE study at the partner's cost.
Much of the European money is already pledged. In December 2022 Atara received $31.0 million from HCR Molag Fund, L.P. in exchange for part of Ebvallo royalties and milestones in the initial territory, capped between 185% and 250% of that investment. Atara says it does not retain any meaningful milestone or royalty payments from Pierre Fabre in the initial territory until the cap is met, if at all. The annual report also lists the wind-down of its commercial manufacturing services agreement with Charles River Laboratories, Inc.