IO Biotech announced on Apr. 1 that it will shut down operations and file for Chapter 7 bankruptcy, following regulatory challenges that prevented approval of its investigational cancer vaccine.
The company’s decision comes after a series of setbacks, including a September rebuff from the U.S. Food and Drug Administration (FDA) that stopped IO Biotech from submitting an approval application for its lead candidate, Cylembio. This development led the Danish biotech to consider all strategic alternatives before opting to wind down, according to a March 31 filing with the Securities and Exchange Commission.
Under Chapter 7 bankruptcy proceedings in Delaware, a court-appointed trustee will take control of IO Biotech’s assets and liabilities with the goal of liquidating them to pay off debts. The company stated in its regulatory filing that "it is unlikely that holders of the Company’s common stock will receive any payment or other distribution on account of those shares following the bankruptcy proceedings." All directors have resigned as part of this process, and all employees have been terminated; however, it remains unclear how many staff were still employed at closure.
IO Biotech began reducing staff in September after being told by the FDA there was insufficient evidence for a biologics license application for Cylembio. At that time, BioSpace estimated IO had reduced its workforce by half to about 39 employees. Further layoffs followed in January with no specific numbers disclosed.
Cylembio was being tested as a first-line therapy alongside Merck's Keytruda in advanced melanoma patients but narrowly missed its primary endpoint in an August 2025 Phase 3 trial report. The combination therapy showed a reduction in risk of disease progression or death compared with Keytruda alone but did not reach statistical significance (p-value: 0.056). "This is not the outcome we had hoped for," CEO Mai-Britt Zocca said following discussions with regulators last September.
As recently as Sept. 30, IO reported $31 million in cash reserves expected to last through early this year but has not yet released full-year financial results for 2025.
