Poor clinical trial performance pushes company into cost-cutting drive
US biotech firm Exelexis is cutting around 160 jobs (70% of its workforce). The move follows poor results from a clinical trial of its cancer drug Cometriq (cabozantinib) in men with metastatic castration-resistant prostate cancer (mCRPC).
The job cuts will leave behind just 70 employees, but the firm anticipates that the cost savings will leave it with ‘sufficient cash to support its operations through to the release of top-line results of [a trial of Cometriq in metastatic renal cell carcinoma] next year’.
A glance at Exelexis’ financial results reveals why such drastic cuts are needed. Cometriq is already approved in the US to treat metastatic medullary thyroid cancer, and brought in $6.5 million (£4 million) in revenue in the second quarter of 2014. However, the firm has made overall operating losses of over $55 million in each quarter of the last year, including spending $47–51 million on R&D. With only $87 million in working capital on its balance sheet, cutting staff and any peripheral clinical trial programmes allows the company to continue its most promising trials in the hope of positive results.