Shares of Australia's Avexa tumbled 78 percent on the news that the company is scrapping the HIV drug program it spent five years and $90 million developing. Avexa had hoped to secure a licensing deal for the drug; however, the company was unable to find a partner after a two-year search. Potential partners were concerned about the time and money necessary to gain approval of ATC in major markets and potential difficulties of combining the drug with existing HIV therapies, among other things.
As a result, Avexa says it will lay off a significant number of employees in all areas of the company, including discovery, clinical, and executive staff. And Julian Chick has resigned as both CEO and a member of the board. Avexa's board has has commenced a strategic review of its remaining programs and intends to consider suitable merger, acquisition, in-licensing opportunities, as well as other corporate initiatives. The company had about $26.6 million in its coffers as of March 31 and expects to have $23 million as of June 30.
"Unfortunately... [ACT]'s successful development did not translate into a commercial deal to partner the program with a global pharma company and, as a result, the program is no longer viable," says Nathan Drona, Avexa's chairman. "We are extremely disappointed that this key objective was not achieved. Our top priority moving forward is to preserve capital while completing our strategic review with the primary focus of uncovering a transaction that will be value accretive for our shareholders. We look forward to updating the market in the near-term with our progress."
- see Avexa's release
- here's the story for more