The once high-flying Oxigene says it doesn't have the cash to fund a late-stage study of its cancer drug Zybrestat and will pink-slip 11 workers--more than half its remaining staff--as the biotech conserves cash for early-stage work. Its shares, which traded at a stratospheric $50 just two years ago, slid more than 20% on the news and were trading at $1.37 by mid-morning.
South San Francisco-based Oxigene had been hoping that a Phase III study of the lead drug for anaplastic thyroid cancer would offer pivotal proof that the drug could fight cancer by destroying blood vessels feeding tumors. But it says a Phase II study in non-small cell lung cancer will continue. And it hopes to conserve assets for its most promising early-stage work.
Oxigene has been ailing for some time now. In early 2010 the biotech laid off half of its staff, which then numbered 41, and earned a "going concern" warning from its auditors.
"Oxigene's management and board have determined that the optimal course of action is to focus on advancing our earlier stage clinical development programs while completing the trials we or clinical investigators have initiated," said CEO Peter Langecker. "We were hopeful that we could further the development of Zubrestat in anaplastic thyroid cancer with internal financial resources, but, in light of the challenges in funding such a rare orphan disease, that is not possible at the present time."
- check out the Oxigene release
- here's the Dow Jones report