Xoma to cut 84 jobs by end of Q1
Will outsource commercial manufacture of inflammatory drug Xoma 052 (gevokizumab)
US biotechnology company Xoma Corporation plans to cut 84 jobs, or 34% of its workforce by the end of the first quarter, to focus on the development of its leading anti-inflammatory drug Xoma 052 (gevokizumab).
The Berkeley, California-based firm said about 50 people would go immediately, with the rest by the end of March.
The cuts are a result of a decision made by its partner, French drugmaker Laboratoires Servier, to use a contract manufacturing organisation (CMO) for Phase III and commercial production, and to eliminate internal research functions that can be outsourced to contract service providers.
The company will not renew the lease on its 31,000ft2 manufacturing facility when it expires in 2013.
In addition, it will complete the biodefence contracts it has in place, but will not actively pursue future contracts.
Xoma anticipates taking one-time charges for restructuring and related severance costs of approximately US$6m during 2012. In the first quarter, the company expects to take a charge of approximately $3.6m.
As a result of these changes, Xoma expects to reduce ongoing net internal spending by approximately $14m in 2012. This allows investment of a similar amount into gevokizumab’s clinical development during 2012, including the planned Phase III studies in non-infectious uveitis, initial external manufacturing technology transfer, as well as recently announced multiple Phase II proof-of-concept clinical trials.
‘We are streamlining Xoma’s operations to focus on gevokizumab, and to drive our discovery science toward development of value-creating products and technologies,’ said John Varian, who became chief executive on 5 January after acting as interim ceo since 31 August.
‘We anticipate our global gevokizumab Phase III programme in non-infectious uveitis, including Behçet's uveitis, will begin in the second quarter. We also have begun enrolling patients in our Phase II proof-of-concept trial of gevokizumab in moderate to severe acne as part of our plan to pinpoint additional indications that can expand the commercial opportunities for our lead drug candidate.
‘Our strategy is to maximise the potential of Xoma's flagship product, pursue discovery based opportunities, and establish a US commercial presence.’
Xoma will retain its existing pilot facility and internal resources to manufacture Phase I and II product supplies and conduct early and mid-stage clinical trials. Ongoing large-scale manufacturing operations should be completed in the second quarter.
Future internal programmes will focus on applying Xoma’s expertise for the discovery of allosteric modulating antibodies for therapeutic targets that cannot be addressed by traditional blocking or neutralising antibodies, including orphan indications. The firm will also continue work on its Adapt integrated display platform, which facilitates antibody discovery and rapid characterisation.
