Foghorn and Eli Lilly decided to stop developing FHD-909 after reviewing Phase 1 clinical data.

  • Foghorn said the drug showed a favorable safety profile but insufficient efficacy to support further development.
  • Foghorn is set to cut its workforce by about 40%.
  • Separately, Lilly’s Foundayo cut the estimated 10-year diabetes risk by 57% versus placebo at its highest dose.

Shares of Foghorn Therapeutics (FHTX) tanked nearly 45% in pre-market trading on Thursday, after the biotech firm said it would stop developing experimental cancer drug FHD-909 under its partnership with Eli Lilly (LLY).

If the pre-market levels hold after the opening bell, FHTX shares would crash to their all-time lows. The stock is also on track for its biggest single-day loss ever.

Why Was The Program Cut Short?

The companies made the decision after reviewing Phase 1 trial data and also dropped another drug targeting SMARCA2, a protein being studied as a potential target for certain cancers. Foghorn said FHD-909 demonstrated a favorable safety profile and achieved drug exposures that exceeded its preclinical targets. 

However, the treatment did not show enough efficacy to justify further development.

Foghorn and Lilly began their collaboration in December 2021 to develop new cancer treatments. Under the deal, Foghorn received $300 million upfront and was eligible for up to $1.3 billion in development and commercialization milestone payments, while Lilly also invested $80 million in the biotech firm.

FHD-909 became the first program from the partnership to enter clinical development

Foghorn Turns To Its Own Pipeline

Foghorn is now cutting its workforce by about 40% and redirecting resources toward wholly owned programs, it said. Those include its EP300 degrader, an oral immunology and inflammation program, a CBP degrader and a drug discovery platform.

The restructuring is expected to extend Foghorn's cash runway into the second half of 2029. Foghorn ended June with $257.8 million in cash, cash equivalents and marketable securities.

Lilly Reports New Predicted Data For Foundayo

Separately on Thursday, Lilly reported new data for its oral GLP-1 obesity drug Foundayo. A new analysis of the Attain-1 study showed that the highest dose, 17.2 mg, was associated with an estimated 57% lower risk of developing type 2 diabetes over the next 10 years compared with placebo.

The same dose was associated with an 18% reduction in the predicted risk of cardiovascular disease. Lower doses also showed reductions in predicted diabetes and cardiovascular risk. LLY shares edged 0.4% higher.

Retail Bullish On RKLB Business Momentum But Neutron Delay Raises Questions

Despite the pre-market losses, retail sentiment for FXTH on Stocktwits turned ‘bullish’ from ‘neutral’ a day earlier, amid ‘high’ message volumes.

FXTH shares have slumped 63% so far in 2026.

Also read: RKLB Stock A ‘Core Holding For Space Bulls,’ Analyst Says – Sees 43% Upside As Synspective Deal Boosts Backlog

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