Sangamo Stock Plummets 50% After Pfizer Ends Gene Therapy Deal

Sangamo Therapeutics, Inc. (SGMO) stock experienced a significant decline of over 50% following Pfizer's decision to terminate their global collaboration and license agreement for the development and commercialization of giroctocogene fitelparvovec, an investigational gene therapy for moderately severe to severe hemophilia A. The termination, effective April 21, 2025, has left Sangamo searching for a new collaboration partner to continue the development of the program.



The decision by Pfizer to end the collaboration has raised concerns about Sangamo's financial stability and its ability to advance its other pipeline programs. The company had been depending on the hemophilia A gene therapy program to help save the beleaguered biotech, with Pfizer still owing Sangamo $220 million in milestones under the 2017 deal. The loss of these milestones and potential royalties will likely have a significant impact on Sangamo's cash flow.



Sangamo's recent financial performance, including a 425.77% revenue growth rate in the last quarter, may make the company an attractive partner for other pharmaceutical companies. However, the success of finding a new partner will depend on various factors, such as the potential partner's interest in the hemophilia A gene therapy market and their willingness to invest in the development and commercialization of the product.

The termination of the collaboration with Pfizer comes at a time when Sangamo is trying to reinvent itself as a neurology-focused genomic medicine specialist. The company has been facing a difficult period, with job losses and efforts to divest programs, and the loss of this key partnership may further erode investor confidence in Sangamo's ability to execute its strategic vision.

In light of these developments, investors may be more cautious in their assessments of Sangamo's other pipeline programs, such as its neurology genomic medicine pipeline, which includes chronic neuropathic pain, prion disease, and other neurological disorders. The company's plans to initiate the expected enrollment of patients in the Phase 1/2 study of ST-503 for idiopathic small fiber neuropathy in mid-2025 and file an anticipated Clinical Trial Authorisation submission for the prion disease program in Q4 2025 may face increased scrutiny and skepticism from investors.

To mitigate the loss of Pfizer's milestones and funding, Sangamo can explore alternative revenue streams and cost-cutting measures. These may include securing additional funding from investors, strategic partners, or government grants; divesting non-core assets or programs; licensing or partnering other programs; and implementing cost-cutting measures such as reducing headcount, optimizing R&D spending, negotiating better terms with suppliers and service providers, and streamlining operations.

In conclusion, Pfizer's decision to terminate the collaboration with Sangamo has had a significant impact on the company's stock price and investor confidence. Sangamo must now focus on finding a new collaboration partner for the hemophilia A gene therapy program and adapt its strategic vision to maintain long-term growth. By leveraging its recent strategic partnerships, such as the global epigenetic regulation and capsid delivery license agreement with Genentech, and continuing to advance its core neurology pipeline programs, Sangamo can secure additional funding and maintain its focus on neurology genomic medicine.