Replidyne, Inc announced the restructuring of its operations reducing its current employee headcount by approximately 80 per cent to five employees in actions that are scheduled to take place during September 2008 and October 2008. As a result of these actions Replidyne will suspend further development activities of REP3123, its investigational agent for the treatment of Clostridium difficile (C. difficile) bacteria and C. difficile Infection (CDI), and novel anti-infective compounds based on its DNA replication inhibition technology. Following completion of the restructuring actions, the company will limit its activities to completing its review of previously announced strategic alternatives.

"The actions outlined today position us to focus on the strategic alternatives process that we initiated several months ago, as well as preserve our cash resources," stated Kenneth J Collins, president and chief executive officer of Replidyne. "The process we are conducting involves a number of alternatives including merger or acquisition of the company together with the possible sale of our C. difficile and DNA replication inhibition programs. While the process is ongoing, we are encouraged by our progress to date."

The company estimates that it will incur $3.1 million of costs related to the restructuring of its operations comprised of $1.6 million for employee severance benefits, $0.8 million for lease payments in excess of expected sub-lease income and $0.7 million of non-cash expense for the write down of impaired fixed assets.

At July 31, 2008 the Company reported $60.7 million in cash and cash equivalents and short term investments and had recorded current liabilities of $10.2 million.