Keros Therapeutics plans workforce reduction of approximately 45% in restructuring

Keros Therapeutics, Inc. (Nasdaq: KROS) said it will cut its overall workforce by approximately 45% under a restructuring it calls the Reorganization. The board approved the plan on May 28, 2025, and employees were told on May 29. The company reported the plan in a Form 8-K filed May 29, 2025, under the item covering costs tied to exit or disposal activities.

The cost and the timing

Keros expects one-time cash charges of approximately $3.2 million for employee severance and related costs, to be expensed in the second quarter of 2025. It has also committed to one-time retention costs of up to approximately $0.4 million for certain employees, to be incurred through the fourth quarter of 2025. The company expects the Reorganization to be substantially complete by the fourth quarter of 2025.

The company says these estimates rest on several assumptions and that actual amounts may differ materially. It also says it may incur charges it has not contemplated. Its forward-looking statements name the risk that it may not carry out the Reorganization as planned, and that its cost-saving initiatives may not succeed.

Why the trial matters

The same day, Keros issued a press release on topline data from its TROPOS trial, and it filed a topline presentation as Exhibit 99.2. The 8-K does not restate those results. The annual report on Form 10-K, filed February 26, 2025, describes the trial as a Phase 2 study of cibotercept, the company's lead candidate in pulmonary arterial hypertension, or PAH. The primary endpoint was the change from baseline in pulmonary vascular resistance at Week 24 against placebo. The company announced the early termination of TROPOS in January 2025, after it halted all dosing, including the 1.5 mg/kg and placebo arms, based on an ongoing safety review prompted by the unanticipated observation of pericardial effusion adverse events.

The 10-K says that observation may also affect Keros's ability to enroll patients in any future cibotercept trials. The company had planned to present topline TROPOS data in the second quarter of 2025 and then to decide on the development strategy, including in PAH and other indications.

Keros describes itself as a clinical-stage biopharmaceutical company developing protein therapeutics for disorders linked to dysfunctional signaling in the transforming growth factor-beta, or TGF-ß, family. Its other candidates are KER-065, for neuromuscular diseases with an initial focus on Duchenne muscular dystrophy, and elritercept, or KER-050, for low blood cell counts in myelodysplastic syndromes and myelofibrosis.

Cash and the Takeda deal

The company had cash and cash equivalents of $559.9 million at December 31, 2024, and a net loss of $187,353 thousand for 2024, up from $152,992 thousand in 2023. The 10-K says that balance, together with a $200 million upfront payment from Takeda Pharmaceuticals U.S.A., Inc. received in February 2025, will fund operating expenses and capital spending into 2029.

Takeda holds an exclusive license to develop, manufacture and commercialize elritercept worldwide outside mainland China, Hong Kong and Macau. The agreement was entered into in December 2024 and became effective on January 16, 2025.

What the 8-K leaves out

The 8-K does not link the reduction to the TROPOS results, and it does not say which functions or roles are affected. It points readers to the risk factors in the company's quarterly report on Form 10-Q, filed May 6, 2025, for a fuller description of the risks to the Reorganization. The 8-K also states that the Reorganization's timing and cost estimates may change, and that the company may incur charges it has not yet identified.

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