A creditors meeting has been called to consider a proposal to put Irish pharmaceutical company, Sublimity Therapeutics, into liquidation.
The firm employed more than 50 people at its headquarters at DCU Alpha in Dublin, a manufacturing facility in Tullamore and an office in California in the US, but it is understood that staff were told in recent days that they are to lose their jobs.
A notice published in a number of national newspapers stated that it is proposed that accountants John McStay and Jim Luby be appointed to three connected companies, Sublimity Therapeutics HoldCo Ltd, Sublimity Therapeutics Ltd and Sublimity Ltd, at the meeting next week.
Around €70m has been received by the group from share placements, convertible loan notes, licensing agreements, grants and tax credits since it began operations in 2003.
In 2018 it closed a "milestone" €55m funding round from investors including OrbiMed, Longitude Capital and HBM Healthcare Investments.
Glen Dimplex founder, Martin Naughton, has also invested in the company, which was previously known as Sigmoid Pharma.
The firm declined to comment on the reasons for the latest developments.
But it is understood that Phase 2(b) trials of its leading candidate drug for the treatment of the gastrointestinal condition, ulcerative colitis, yielded results that were not as good as had been hoped for.
An earlier Phase 2(a) study in more than 100 patients with mild to moderate ulcerative colitis had demonstrated the drug to be safe and well tolerated.
By the end of 2019 accounts show that the company had an accumulated deficit of €73.4m and around €1.8m in cash available, having made a loss that year of €20.4m.
At that time it said it expected expenses and operating losses to increase substantially as it conducted clinical trials, continued research and development activities, conducted preclinical and nonclinical studies and increased staffing.
It also cautioned that it did not expect to generate any revenue from product sales unless and until it could successfully complete development and obtain regulatory approval for one or more of its product candidates, which it said it expected would take a number of years.
Efforts were made in recent months by the company to raise additional funding, with Bank of America appointed to seek further finance, while other options were also examined but ultimately failed.
Staff have been told that they will only receive statutory redundancy and are not expected to receive payment in lieu of notice or bonuses due for 2020.