Bluebird Bio Is Spinning Off Its Oncology Business

Gene therapy company Bluebird Bio has revealed this week that the company is spinning off its cancer programs.

The biotech announced on Monday its intent to spin off its oncology business in a transition that is expected to take place this year.

The company will retain focus on severe genetic disease (SGD) and will launch its oncology business (“Oncology Newco”) as a new entity.

According to a press release, bluebird bio’s Board of Directors approved the intent to separate into two companies and it is anticipated that the spin out of Oncology Newco is to be tax-free to shareholders, subject to receipt of a favorable Internal Revenue Service (IRS) ruling.

The rare disease treatment portfolio will remain with bluebird bio, and the current president of that segment of the company, Andrew Obenshain, will become its CEO.

Nick Leschly, bluebird bio’s current CEO, will take the helm of the spin-off, currently being called Oncology Newco.

“We are excited and energized to begin this new year with so much opportunity ahead. Over the last decade, bluebird bio has pioneered development of gene and cell therapies for severe genetic diseases and oncology – delivering transformative outcomes for patients. Through the tenacity and incredible work of our bluebirds, our first commercial product is now approved in Europe and we are now on the cusp of several potential product approvals with a strong pipeline of earlier oncology research candidates on the horizon. This is a position few biotech companies have been able to attain,” said Nick Leschly, chief bluebird.

“After careful strategic review, it is clear to us that the two businesses are best served by independent leadership and teams to drive distinct strategic and operational objectives. Specifically, we believe it is the right time to double down on the respective businesses to fully enable and optimize the continued innovation, development and deployment of transformative gene and cell therapies for the patients we serve.”

“In close collaboration with the Board of Directors, bluebird bio leadership has conducted a thorough assessment of the business overall and examined a range of options for the future,” said Daniel Lynch, Chair of bluebird bio’s Board of Directors.

“Based on this review, we collectively believe this strategic decision is in the best interest of patients, employees, investors and other stakeholders. We are committed to working together through this transformative process to ensure each company is optimized with the right teams in place for progressing these therapies through the regulatory process into commercialization, harnessing the power of the pipeline to continue creation of innovative medicines, establishing and rapidly growing product revenue, and creating value for shareholders.”

Shares of bluebird bio have dropped nearly 50% in the past year.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.