(Reuters) -Activist investor Engine Capital on Wednesday sent a letter to the board of cancer therapy developer 2seventy bio, urging a board refresh and the appointment of Chief Operating Officer Chip Baird as CEO, among other changes.
Engine Capital, which owns about a 3% stake in 2seventy bio, said the company should exclusively focus on its blood cancer therapy Abecma, and explore ways to “immediately cease or monetize all development programs”.
In response, 2seventy bio said its board had commenced a process to consider all options to maximize shareholder value and ensure that its important therapies become available to patients in need.
Engine Capital pushed for a shareholder representative to be added to the company’s board and asked for a special committee of independent directors to be established for communicating with the shareholders.
The push from Engine Capital comes after 2seventy bio disclosed restructuring plans in September, along with CEO Nick Leschly’s intention to step down and transition to the role of chairman.
The biotech firm had said it plans to lay off about 40% of its workforce to lower costs and focus on Abecma.
Abecma, for which 2seventy bio partners with Bristol Myers Squibb, faces competition from Johnson & Johnson and Legend Biotech’s Carvykti.
Both the therapies belong to a class of treatments called CAR-T therapies, which are under investigation by the U.S. Food and Drug Administration over the risk of hospitalizations and death due to a serious safety issue.
In November, the health regulator also delayed its decision on the expanded use of Abecma in earlier lines of treatment as it plans to seek the advice of experts.
Abecma is currently approved for treating multiple myeloma patients after four or more prior therapies fail to show improvement.
(Reporting by Bhanvi Satija and Christy Santhosh in Bengaluru; Editing by Krishna Chandra Eluri)