Item 2.02 Results of Operations and Financial Condition.
Preliminary Financial Results - Cash Balance as of June 30, 2023
On August 9, 2023, Galera Therapeutics, Inc. (the “Company”) announced that, based upon preliminary estimates and information available to the Company, it expects to report that it had cash, cash equivalents and short-term investments of approximately $38.8 million as of June 30, 2023. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K (the “Form 8-K).
The preliminary cash balance presented above is not a comprehensive statement of the Company’s financial position, and is subject to change following the completion of the Company’s financial closing and independent auditor review procedures. Complete results will be included in the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2023.
The information contained in Item 2.02 (including Exhibit 99.1 attached hereto) of this Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly provided by specific reference in such a filing.
Item 2.05 Costs Associated with Exit or Disposal Activities.
On August 9, 2023, the Board of Directors of the Company approved a reduction in the Company’s current workforce by 22 employees, or approximately 70% of the Company’s headcount as of August 9, 2023 (the “Workforce Reduction”). The decision was based on cost-reduction initiatives intended to reduce operating expenses.
The Company currently estimates that it will incur charges of approximately $2.0 to $2.5 million in connection with the Workforce Reduction, primarily consisting of severance payments, employee benefits and related costs. The Company expects that the majority of these charges will be incurred in the third quarter of 2023. The Workforce Reduction and other cost savings actions being implemented are expected to extend the Company’s cash runway into the second quarter of 2024.
The estimates of the charges and expenditures that the Company expects to incur in connection with the Workforce Reduction, and the timing thereof, are subject to several assumptions and the actual amounts incurred may differ materially from these estimates. In addition, the Company may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur, including in connection with the implementation of the Workforce Reduction.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On August 9, 2023, Mark Bachleda, Pharm.D., the Company’s Chief Commercial Officer, was informed that his position was being eliminated in connection with the Workforce Reduction. In connection with Dr. Bachleda’s separation from the Company, the Company expects to enter into a separation agreement with Dr. Bachleda pursuant to which Dr. Bachleda will be eligible to receive the severance payments and benefits under his employment agreement with the Company in exchange for executing a general release of claims in favor of the Company.
Item 8.01 Other Events.
On August 9, 2023, the Company announced that it had received a Complete Response Letter (“CRL”) from the U.S. Food and Drug Administration (“FDA”) regarding the Company’s New Drug Application (“NDA”) for avasopasem manganese (avasopasem) for radiotherapy-induced severe oral mucositis (“SOM”) in patients with head and neck cancer undergoing standard-of-care treatment. In the CRL, the FDA communicated that the results from the Phase 3 ROMAN trial together with the supporting data from the GT-201 trial are not sufficiently persuasive to establish