Rallybio Announces Significant Restructuring Following Discontinuation of Lead Asset

Rallybio, a biotechnology company focused on developing therapies for rare diseases, has announced a major restructuring following the discontinuation of its lead asset. The company is laying off 40% of its workforce and shifting focus to earlier-stage pipeline candidates as it navigates a challenging period in its development.

Downsizing and Financial Implications

Rallybio revealed in its first-quarter earnings report that it will lay off nine employees, representing approximately 40% of its total headcount. The company expects the terminations to be "substantially complete" by the end of the second quarter. The restructuring is projected to incur one-time costs of around $1.7 million, primarily related to severance and benefit payments, excluding share-based compensations.

Despite the setback, Rallybio reports a relatively stable financial position. The company had $54.5 million in cash at the end of Q1, which it anticipates will sustain operations into the first half of 2027.

Pipeline Setback and Strategic Shift

The restructuring comes in the wake of Rallybio's decision to discontinue development of RLYB212, its former lead molecule. RLYB212, an investigational monoclonal antibody, was being evaluated for fetal and neonatal alloimmune thrombocytopenia, a rare bleeding disorder. The Phase II trial for RLYB212 yielded disappointing pharmacokinetic results, with the candidate failing to reach its target concentration or even the minimum level required for efficacy.

CEO Stephen Uden commented on the decision, stating, "The risk/benefit no longer supports continued dosing, and we will discontinue RLYB212 development."

Refocusing on Early-Stage Assets

With the loss of its most advanced clinical asset, Rallybio is pivoting to focus on its earlier-stage pipeline. The company's new lead candidate is RLYB116, a C5 blocker currently in Phase I development for diseases driven by a dysregulated complement system. Rallybio reports being "on track" to initiate dosing in a confirmatory pharmacokinetic/pharmacodynamic study, with results expected in the latter half of the year.

Uden expressed optimism about the potential of RLYB116, stating, "We are well-positioned to maximize RLYB116's transformative potential across multiple billion-dollar market opportunities."

Beyond RLYB116, Rallybio's pipeline includes several other early-stage programs:

• REV102: An investigational small molecule inhibitor of the ENPP1 protein, currently in IND-enabling studies for hypophosphatasia. Developed in collaboration with Recursion Pharmaceuticals, REV102 is expected to enter clinical trials in the second half of 2026.
• RLYB332: A matriptase-2 inhibitor for iron overload and severe anemia, currently in preclinical development.
• RLYB114: A C5 blocker targeting eye conditions related to complement dysregulation, also in preclinical stages.
• An undisclosed drug discovery program for a metabolic disorder.

As Rallybio navigates this challenging transition, the company's ability to advance its early-stage pipeline will be crucial in determining its future prospects in the competitive landscape of rare disease therapeutics.