Replimune announced on Apr. 13 that its melanoma drug RP1 was rejected by the Food and Drug Administration for a second time, leading the company to prepare for significant cost-cutting measures including job reductions and possible site closures.
The decision marks a major setback for Replimune, which now faces uncertainty about its future operations and strategy. The company's CEO Sushil Patel said in a statement that there is no choice but to eliminate jobs, including scaling back U.S.-based manufacturing operations. It is not yet clear how many employees will be affected or when these changes will take place.
Analysts at BMO Capital Markets said the company will need to secure additional funding and indicated that significant cost cuts are likely necessary given Replimune's $269.1 million cash position at the end of 2025. Patel acknowledged that without timely accelerated approval, further development of RP1 would not be viable but stopped short of announcing an official discontinuation of the drug's development.
Following news of the rejection, Replimune's shares dropped by 20 percent initially and continued falling, reaching $1.75 per share before Monday’s opening bell—a decrease of 63 percent from its previous closing price.
Patel described the FDA’s verdict as “deeply disappointing,” saying that the agency “has not exercised regulatory flexibility to meet patients’ needs.” He also criticized what he called “inconsistent communication” from regulators and pointed out changes in review staff during RP1’s resubmission process, claiming this new team did not meet with company representatives despite offers to do so.
Replimune also noted what it sees as contradictions between previous feedback from regulators—who in 2021 agreed a single-arm trial could be acceptable if data were compelling—and reasons cited for rejecting RP1 now. The FDA’s complete response letter stated that Replimune’s single-arm study "is not considered to be an adequate and well-controlled clinical investigation" supporting approval.
BMO analysts sided with regulators on this point, writing that "commentary from the CRL clarify the consistency in FDA’s decision to deny approval." They added: "We can’t help but feel prior resubmission efforts were grounded more on hope than true alignment with FDA... Hope is never a winning strategy, unfortunately."
