Job losses loom as Devgen closes pharma division

Belgian agricultural biotech company Devgen is to divest its pharma unit and focus more on growing its agriculture division.

The move will result in the dismissal of 19 pharmaceutical staff. The Devgan group employs 217 people worldwide.

Devgen's pharma division focuses on the development of a novel class of preclinical drug candidates for the treatment of inflammatory diseases.

Both divisions require substantial investments and in this stage of their development, do not have synergies any longer, the company said. The pharma activities furthermore carry a substantially higher risk profile.

A company spokesperson pointed to a deterioration in the financial and investment climate, which has - in turn - made in potential candidate investors more risk averse.

In line with this strategy Devgen will focus its available resources on its agro activities. The company's activities in Ghent include, furthering its key technologies (RNAi for crop protection, trait development and molecular breeding), bringing its candidate nematicide to market, and the IP and business coordination of its growing trait and seed business in India and in South-East Asia. These activities do have significant synergies, are close to market and sustainable revenue growth and offer Devgen the best opportunities for growth and development.

"This serious step was taken after consideration of all possible alternatives taking into account the interests of all stakeholders. In the current market the chance to valorise Devgen pharma assets without further major investments of the company is remote," said Devgen ceo Thierry Bogaert.

Devgen has developed a unique technology position in crop protection and has grown to a fully integrated trait and seed business in Asian growth markets, with a focus on rice, sorghum, sunflower and pearl millet and a licensing business in other crops.