Flex Pharma Axes 60% of Workforce, Explores Sale after Halting Phase II Trials in ALS, CMT

Flex Pharma lost two-thirds of its market capitalization after saying today it will eliminate approximately 60% of its workforce—about a dozen staffers—explore a possible sale of the company among strategic alternatives, and terminate Phase II clinical trials of its lead candidate FLX-787 in amyotrophic lateral sclerosis (ALS) and Charcot-Marie-Tooth (CMT).

Investors responded to the company’s news this morning with a selloff that sent Flex Pharma’s share price plunging 66% in premarket trading on the NASDAQ Global Market as of 9:29 am, to $1.41 from $4.18 at yesterday’s close.

The selloff followed Flex Pharma’s announcement that it will cut costs by restructuring its workforce—which as of March 2 consisted of 20 full-time and two part-time staffers, according to the company’s Form 10-K Annual Report for 2017 , filed March 7.

“The majority of the reduction in personnel (is) expected to be completed by June 30, 2018,” with ...