Foghorn Therapeutics and Eli Lilly will abandon joint development of their lead oncology candidate and cut roughly 40% of Foghorn's workforce following disappointing phase 1 trial results.

Foghorn shares in Thursday's premarket trading were down 44% to $2.00.

The biotechnology company on Thursday said they have decided to stop advancing FHD-909 into the clinical development expansion phase, and end their SMARCA2 partnership after data showed the drug failed to deliver sufficient efficacy in targeting lung cancer.

"Unfortunately, the biology of the SMARCA2/4 synthetic lethality relationship has not translated into the level of efficacy required to further advance the program," said Foghorn Chief Executive Adrian Gottschalk.

Foghorn's board approved a strategic reprioritization on Sept. 30 that will eliminate about 40% of its staff-leaving the biotech with roughly 65 full-time employees.

The moves are expected to extend the company's cash runway to fund its priority programs into the second half of 2029.