Nuvelo, Inc. announced that it is reducing its workforce by approximately 30 per cent and realigning its organization to focus on core development programmes that it believes will produce nearest-term proof-of- concept data.
The company plans to continue to pursue development of alfimeprase, NU206 and NU172 and has decided to suspend development of rNAPc2 in all indications including cancer and acute coronary syndromes (ACS). As a result of the reduction in workforce, effective August 3, 2007, the company expects to have less than 80 employees, a reduction of 45 per cent from year end 2006. Nuvelo expects this realignment of personnel and programmes to result in reduced annual expenses of approximately $15 million from current levels.
As part of the reorganization, Ward Wolff, senior vice president and chief financial officer (CFO), will be leaving the company effective August 14, 2007. Lee Bendekgey will reassume the role of CFO in addition to his current role as senior vice president and general counsel. Bendekgey previously served as CFO from July 2004 through November 2005.
"In order to align with our current strategy, we made hard decisions regarding our programs and the organization. In looking at each of our programs, we evaluated the development and regulatory pathway, anticipated cost, probability of success, commercial opportunity, unmet medical need and alignment with our expertise and core competencies," stated Dr. Ted W. Love, chairman and chief executive officer of Nuvelo. "We now feel we have the appropriate team in place for our new path forward, allowing us to focus on attaining key milestones in our most promising development programs while maintaining a strong financial foundation. We want to express our deep appreciation to the dedicated, hardworking employees who will be leaving Nuvelo. They have contributed greatly to our progress, and we wish them well in their future endeavours."
The company is providing severance and career transition assistance to the employees directly affected by the restructuring, and Nuvelo anticipates incurring restructuring charges of approximately $2.5 million in the third quarter of 2007, primarily associated with personnel-related termination costs. As of June 30, 2007, Nuvelo had cash, cash equivalents and short-term investments of $120.2 million, which does not include the $15.0 million received from Bayer in the third quarter related to the termination of the 2006 collaboration agreement between Nuvelo and Bayer.
Nuvelo, Inc. is dedicated to improving the lives of patients through the discovery, development and commercialization of novel drugs for acute cardiovascular and cancer therapy.