Fractyl to Lay Off 17% of WorkforceFractyl to Lay Off 17% of Workforce

Fractyl is making a significant change to its business and engaging in cost-saving measures.

Instead of focusing on the treatment of Type 2 Diabetes, the Burlington, MA-based company will instead address the significant need for an off-ramp to GLP-1 drugs/.

The firm is also cutting about 17% of its personnel.

Late last week Fractyl said it is prioritizing its REMAIN-1 pivotal study, addressing the demand for an off-ramp to GLP-1 drugs, while advancing its Rejuva gene therapy platform into first-in-human studies.

This decision is driven by positive initial feedback from the REVEAL-1 cohort, significant demand for participation in the REMAIN-1 study, and strong patient and physician feedback on the urgent need for durable weight maintenance solutions.

Fractyl will pause investment in its Revita programs for type 2 diabetes, which consists of the REVITALIZE-1 study and the German Real-World Registry. 

"The real challenge in obesity is no longer losing weight, it is keeping the weight off. The strong response from patients and physicians to the REMAIN-1 study highlights the urgent need for durable weight maintenance solutions, and we are doubling down on our efforts in this space," said Harith Rajagopalan, co-founder and CEO of Fractyl Health. "Revita is the first therapeutic candidate to receive Breakthrough Device designation for weight maintenance, and we are uniquely positioned to address this critical gap. By prioritizing REMAIN-1 and advancing our groundbreaking Rejuva gene therapy platform, we are channeling our resources toward what we believe are the most impactful and differentiated opportunities. Given the rapidly evolving obesity landscape, we are pausing investment in our Revita programs for Type 2 diabetes and sharpening our focus. We believe these strategic steps will enable us to execute on our mission of delivering truly transformative solutions for patients with obesity and metabolic disease."

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The company said that after garnering significant scientific recognition over the past 12 months, it has completed key preclinical in vivo studies to support a Clinical Trial Application (CTA) for RJVA-001. Fractyl said it is on track to initiate first-in-human studies for RJVA-001 in the first half of this year.

Fractyl’s Revita DMR, the therapy it's pivoting from uses thermal ablation to ablate a portion of the duodenum mucosa, which executives believe improves glucose control in patients struggling to manage the disease.

Fractyl raised $110 million through an IPO about a year ago. The funding stood out because there had been an IPO drought in the medtech industry for quite some time.

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