GenVec's new CEO, facing a $6.9 million net loss in the first half of the year, is slicing its workforce by 30 percent.
Cynthia Collins, who succeeded longtime leader Paul H. Fischer in May, said 23 positions are being eliminated to help the company focus its resources on its partnership with Novartis.
"While it is a difficult decision to eliminate positions in our talented and dedicated workforce, this move is necessary to ensure that our costs are more closely aligned with our resources and business strategy," Collins said in a statement.
"Expenses are being reduced in virtually all areas, but we have focused on limiting the impact on our collaboration with Novartis to develop treatments for hearing loss and balance disorders," Collins said. "We continue to believe that this important program has the potential to be extremely valuable to our shareholders."
The company's 2010 development and commercialization deal with Novartis could mean $214 million for GenVec, plus sales royalties. In January, the Swiss pharma giant extended the deal, agreeing to fund research at GenVec through next January.
Shares in the Gaithersburg biotech swung rapidly on the news Tuesday, first dropping 3 percent, then rising 8 percent, then falling again.
GenVec ended the second quarter of 2012 with about $20.9 million in cash, cash equivalents, and short term investments. The job cuts will cost the company about $660,000 in expenses in the third quarter.
"In response to reduced revenue expectations for 2013, these cost reductions will allow us to fund our operations through the third quarter of 2014 exclusive of milestones we are eligible to receive under our collaboration with Novartis," CFO Douglas Swirsky said in the statement.
GenVec is working on a number of projects. Besides its Novartis collaboration, it's developing therapeutics or vaccines for respiratory syncytial virus, herpes simplex virus, dengue fever, malaria, HIV and foot-and-mouth disease in animals.
In other Maryland bioscience industry news:
Northwest Biotherapeutics, the Bethesda company that's developing cancer vaccines, effected a reverse stock split of one for 16 as it prepares for a $25 million public offering and to list its common stock on the Nasdaq Capital Market exchange.
The company's stock currently trades on the Over-the-Counter bulletin board. Its ticker symbol, NWBO, will not change when it switches to the Nasdaq. A spokeswoman said she could not provide a date for the switch.
The company also increased the authorized number of preferred shares to 40 million, though it has not plans to issue any.
Shares zoomed 1,051 percent on the news Wednesday.
"NW Bio has made strong operational progress in its clinical programs in both the U.S. and Europe, and now is undertaking a major program of strengthening the Company's finances, expanding its resources and raising the Company's market profile," CEO Linda Powers said in a statement.
Northwest is testing its vaccine for brain cancer in a phase 3 trial in the U.S. and Europe, and is accelerating its phase 1-2 trial program for treating all solid tumor cancers. It's also received regulatory approval for a phase 3 trial of its vaccine for prostate cancer.
Sucampo Pharmaceuticals cleared a regulatory hurdle this week when the Food and Drug Administration granted priority review of its supplemental new drug application. If the application is approved, the Bethesda drug-maker's Amitiza could be prescribed for treating opioid-induced constipation in patients with chronic, non-cancer pain.
The FDA designation allows for a shorter review period of six months. It's granted to drugs that offer either significant treatment advances or a treatment for a condition that has no adequate therapy.
Sucampo and its partner, Takeda Pharmaceuticals U.S.A. of Deerfield, Ill., said they expect the FDA's decision by February.
Sucampo shares initially shot up 20 percent on the news.
“One of the most common adverse reactions of opioid medications is opioid-induced constipation, a medical condition for which there are currently no approved oral prescription treatment options available,” Ryuji Ueno, Sucampo's chairman, chief scientific officer and CEO, said in a statement.
Amitiza already is approved in the U.S. for treating chronic idiopathic constipation in adults and for irritable bowel syndrome with constipation in women 18 years and older.
Nabi Biopharmaceuticals, which last week headed off a showdown with a major stockholder that had opposed the Rockville biotech’s acquisition of an Australian drug-maker, has rescheduled its shareholder vote on the deal.
Until last week, Mangrove Partners, with 4 percent of Nabi stock, had been urging stockholders to reject the deal when they were to vote on it this week in Bethesda.
Nabi announced this week that the vote will take place Oct. 22 at the Bethesda Marriott.
In initially opposing the deal, Mangrove had argued that shareholders would get a better deal if Nabi — whose experimental smoking vaccine failed in clinical trials in November — returned “substantially all of the cash” on its balance sheet to shareholders. Some analysts had suggested the company liquidate and return the proceeds to shareholders.
But Nabi and Biota Pharmaceuticals of Melbourne have agreed to give stockholders a greater return than they originally proposed when they announced the deal in April. Mangrove, of New York, did not respond to a request for comment, but in a regulatory filing last week said it supports the new deal.
When it announced the original deal in April, Nabi said it planned to pay $54 million to Biota to create a new company, Biota Pharmaceuticals, leaving Nabi stockholders with 26 percent of the new company.
In initially opposing the deal, Nathaniel August of Mangrove pointed out that Nabi shares had been trading for $1.74 to $1.95 before the announcement, which sent them down to $1.68. He said the stock shares failed to reflect the value of the sum of Nabi’s assets.
Under the revised terms, Nabi would pay Biota $27 million, with stockholders receiving about $28 million to $31 million. Nabi also changed the number of shares to be issued to Biota, saying it will be determined based on Biota share price on the Australian Securities Exchange.
Biota produces influenza vaccine-related products Relenza, which is licensed to GlaxoSmithKline, and Inavir. The company also has a $231 million contract with the U.S. Biomedical Advanced Research and Development Authority to develop its anti-influenza neuraminidase inhibitor laninamivir in the U.S. Laninamivir already is marketed in Japan.
Nabi’s product development had been focused on the failed NicVax, plus products for hepatitis and other infectious diseases. Nabi had a 2009 development agreement for NicVax with GlaxoSmithKline of the U.K., worth as much as $500 million. The National Institute on Drug Abuse also had granted Nabi $10 million, including $7.9 million in federal stimulus money, to help develop NicVax.
Neuralstem has won regulatory approval in China to test its spinal cord stem cells in treating motor deficits from ischemic stroke.
The Rockville biotech's subsidiary, Neuralstem China, will oversee the combined phase 1-2 trial at BaYi Brain Hospital in Beijing. It's expected to begin in early 2013 and involve up to 118 stroke patients. The trial is scheduled to last two years.
Ischemic strokes, the most common type of stroke, occur when an obstruction occurs within a blood vessel that supplies blood to the brain, according to company information. Afterward, motor deficits include paralysis in arms and legs and can be permanent.
"China is rapidly moving to become a prominent player in the field of stem cell transplantation and regenerative medicine," Karl Johe, chairman and chief scientific officer, said in a statement. "BaYi is one of the premier neurological hospitals in China, and we can assure all of our stake holders that the quality of the medical care and treatment our patients receive, as well as the entire protocol, will be the equal of any trial we do anywhere in the world, including our FDA-approved trial in the U.S."
"Chronic motor disorder from stroke is a serious public health issue for China, where we, as a population, now suffer over 2 million ischemic strokes per year," Xu RuXiang, president of BaYi Hospital and the trial's principal investigator, said in the statement.
Neuralstem China was founded in 2010, with headquarters in Suzhou, about 100 miles west of Shanghai. The company has built a clinical-grade manufacturing facility there.
BD Diagnostics of Baltimore, a division of Becton, Dickinson, has released of a molecular test designed to rapidly detect antibiotic resistance genes found in the superbug known as carbapenem-resistant Enterobacteriaceae.
The bacterium often is lethal, easily spread from patient to patient and resistant to nearly all antibiotics, according to BD information. Sometimes there are no effective treatments for the infections it causes. It's been found worldwide.
The new test is for research only, not clinical use. It produces results in two hours, versus several days for conventional culture tests, BD said.
"We are offering this assay initially as a research tool to help BD and infectious disease researchers explore its clinical utility while we pursue development of an in vitro diagnostic solution," Patrick Murray, worldwide director of scientific affairs, BD Diagnostics-Diagnostic Systems, said in a statement.
GlycoMimetics, the Gaithersburg biotech developing a treatment for vaso-occlusive crisis associated with sickle cell disease, was honored by the William E. Proudford Sickle Cell Fund with its 2012 Unsung Hero Award.
The award is given to individuals and organizations that have helped raise awareness about sickle cell disease and sickle cell trait, according to a statement from the privately held biotech.
"We are extremely honored to be recognized for our research of treatment options for people living with sickle cell disease by such a remarkable organization," CEO Rachel K. King said in the statement. "Receiving this award bolsters our company's efforts to advance our lead drug candidate, GMI-1070, which is currently in a phase 2 clinical trial of patients experiencing sickle cell crisis. We hope this drug can make a difference for people living with sickle cell disease."
GlycoMimetics is developing the drug under an agreement with Pfizer.
Vaso-occlusive crisis of sickle cell disease is one of the condition's most debilitating effects, in which changes in blood protein cause red blood cells to become rigid and stick inside small blood vessels, causing blockages in blood flow and pain, according to company information. Researchers are studying the potential of GlycoMimetics' lead drug candidate to treat it by reducing the cell adhesion and inflammation that is believed to contribute to blood flow blockages.
Rexahn Pharmaceuticals won a European patent that covers several new isoquinolinamine compounds and their pharmaceutical composition, and a method for producing an anti-tumor effect, according to a statement from the Rockville biotech.
Studies have shown the compounds to be effective in treating cancers of the breast, prostate, colon, ovary, kidney and pancreas, plus glioblastoma and melanoma.
The new patent follows others for the compounds in the U.S., Mexico and China.
“This patent coverage in Europe supports Rexahn’s goal of accelerated development of this exciting new class of anti-cancer compounds,” company President Rick Soni said in the statement.